Buddhist entrepreneurs, charitable behaviors, and social entrepreneurship: evidence from China

To address the lacuna of how informal institutions like Buddhism impact social entrepreneurship in different regions within a nation, this research draws on the social entrepreneurship literature and the regional Buddhist research to propose a mediating framework where the percentage of Buddhist entrepreneurs in a region is positively associated both with the level of prosocial behaviors such as charity, due to the values of Buddhism, and with the probability of establishing businesses in a less-developed region. It further proposes that charitable behaviors mediate the relationship between the percentage of Buddhist entrepreneurs in a region and establishing businesses in less-developed regions. This mediating effect is attributed to the mechanism that charitable behaviors absorb the limited resources of entrepreneurs, reducing their resources for establishing businesses in less-developed regions. We test these hypotheses on nationwide surveys of founders of private enterprises and find support for this mediating view. Broad implications for theoretical and empirical research are discussed. Plain English Summary This study distinguishes between the different influences of Buddhist entrepreneurs in a region both on charitable behaviors and on the establishment of businesses in less-developed regions. Using nationwide surveys of founders of private enterprises in the Chinese context, multilevel analyses support a mediating view and have several implications. This research proposes that Buddhist values like the Four Immeasurables underline the positive effect of Buddhist entrepreneurs in a region on charitable behaviors, and that Buddhism can bring the essence of entrepreneurship, such as social capital, political connections, and legitimacy, to entrepreneurs and stimulate them, through an isomorphic effect, to engage in establishing businesses in less-developed regions. Furthermore, we highlight that the influence of Buddhist entrepreneurs in a region on establishing businesses in less-developed regions is weakened when they commit limited resources to prosocial behaviors like charity. In relation to policy, our study shows that Buddhist values and practices deeply influence social entrepreneurship, and it highlights the social function of Buddhist entrepreneurs in a transitional economy such as that of China.