A Theoretical Socio Economic Approach

1675 Words Nov 25th, 2015 7 Pages
According to Laville and Nyssens’s book, ‘Towards a theoretical socio-economic approach’, a community-based business is a trading organization which has the capability to rebuild and develop social capital in a community destroyed or depleted by contemporary business thinking. ( Laville, J. L. and Nyssens, M. 2001), Compared to the traditional enterprise’s ownership rights held by investors, different persons including investors hold the property rights of community-based enterprise, workers, managers and others who related to the business, and all of them determine the enterprise’s objectives. They argue that the community-based enterprise has to serve the community, and satisfy the collective benefits. “Serving the community may be defined as explicitly enhancing collective externalities and equity issues.”(Laville, J. L. and Nyssens, M. 2001) They thought that economic activity is not the only thing for creating collective benefits; in fact, all those who undertake the actual activities also contribute to the collective benefits.
They thought that social capital is a set of resources existing in community organization and in family relations and that is good for growth of children or youths who live in the community. About the relations between community-based enterprise and social capitals, they mentioned that there are two advantages of using social capital: 1) social capital can reduce transaction costs. Any community-based enterprise will face “numerous uncertainties…
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