The purpose of this paper is to study the interaction between social and commercial ventures in a region. It achieves this objective through investigating the influence of social ventures’ entry, exit and density on the entry rate of commercial ventures.
Organizational ecology is applied for theoretical analysis and the feasible generalized least square method for empirical analysis.
The study, in overall, finds a diffuse competition between the populations of social and commercial ventures. The results have revealed a negative influence of social ventures’ entry and density on the entry rate of commercial ventures and a positive influence of the social ventures’ exit on commercial ventures’ entry rate in a region.
The study is one of the few in its filed that empirically studies the interaction between social and commercial ventures and the first study, which investigates it in the context of Sweden. The previous two studies, however, have only examined either the influence of social ventures entry or social venture density on the entry rate of commercial ventures. This study, however, examines the influence of both of those factors plus the influence of social venture exit on commercial venture entry. The study is also unique regarding the large-scale database it uses including all the 290 municipalities all over Sweden 1990-2014.
