Economic Inequality as Enabler or Constraint? The Role of Inequality and Societal Culture on Individual Engagement in Social Entrepreneurship

How does economic inequality impact the level of social entrepreneurship in a society? Drawing on institutional anomie theory, this paper examines how rising economic inequality influences individual engagement in social entrepreneurship across diverse countries, cultures and economic contexts. Using multilevel data from 83,089 individuals in 22 countries, we show that cultural conditions shape whether social entrepreneurship emerges as a creatively deviant response to inequality-driven anomie. Our findings highlight social entrepreneurship as a stress-relieving mechanism that helps societies adapt to shifting institutional and cultural environments. This study advances institutional anomie theory by demonstrating that social entrepreneurship can function not only as a deviant response to anomie but also as a constructive adaptation that channels societal strain into prosocial innovation.