Social Economy: the Worldwide Making of a Third Sector

Jacques Defourny | Patrick Develtere | Bénédicte Fonteneau

Text published in Defourny, Jacques, Develtere, Patrick and Fonteneau, Bénédicte (eds.), Social Economy – North and South, HIVA, KULeuven, 1999.

The term “social economy” first appeared in France during the first third of the XIX century. For a long time, its meaning was much broader and amorphous than it is today. Anyone can develop their own a priori conception of the social economy, simply by placing more or less emphasis on either its economic or its social dimensions, both of which are wide-ranging. In the final analysis, any economic phenomenon that has a social dimension, and any social phenomenon that has an economic dimension, could be considered part of the social economy.

On the global level, a much more precise conception of the social economy emerged over twenty years ago. Today, people are discovering or rediscovering a third sector that exists alongside the private, for-profit sector and the public sector, although its designation and definition may vary from one country to another. This is happening throughout Europe, North America, the transitional economies of Central and Eastern Europe, and in the nations of the Southern Hemisphere. There is no sharp, well-defined dividing line between this so-called third sector and the other two sectors, but its characteristics still set it apart.

The initial objective of this first chapter is to clarify the concept of the social economy by putting it back in its historical context. The various forms of cooperative, mutualistic and associative organisations that today form the third sector are buried in the history of human society. Thus, to gain an in-depth understanding of the social economy, it is essential to reconstruct them as they evolved, and to understand the intellectual currents that had an important influence on them, in both the North and the South.

Second, in order to explain contemporary conditions in the third sector, we will examine the definition and origin of the social economy. We will also attempt to characterise the benefits and limitations of the social economy approach, especially
compared to its Anglo-American counterpart, which is rooted in the concept of the non-profit sector.

In the final section, with a view of highlighting the main conditions allowing the social economy to emerge and grow, we will compare the contemporary revival of the social economy with older currents. Our objective is to identify the
most powerful forces underlying the social economy.

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