Responding to Marketization: Reinforcing or Resisting?

Angela M. Eikenberry

School of Public Administration

University of Nebraska at Omaha

US-UK Fulbright Award Recipient, 2014-2015University of Birmingham Third Sector Research Centre

“Doing something wonderful never tasted so good!” – Sweet Charity Cupcakes

Sprinkles’ Cupcakes for Charity

Defining Marketization

• A framework of market-oriented principles, values, practices, and vocabularies;

• A process of penetration of essentially market-type relationships into arenas not previously deemed part of the market;

• A universal discourse that permeates everyday discourses but goes largely unquestioned. (Simpson & Cheney, 2007, p. 191)

Growth of Marketization

• Influence of global neoliberalism– Faith in the market & business-based approaches

(Dart)– Deregulation & privatization to boost economic

growth.– Growing reliance on non-governmental approaches.

• Hollow state (Milward & Provan); shadow state (Wolch), contract state (Boston), submerged state (Mettler), voluntary state (Nickel & Eikenberry); third-party government (Salamon); government by proxy (Kettl); or network governance (Sorensen & Torfing).

Marketization of NGOs

• Need for NGOs (and consumption) to “replace” government in the provision of public goods.

• Pressures on NGOs to take on market-like approaches to gain funding.

• Pervasive normative ideology surrounding market-based solutions and business-like models.

• NGOs increasingly look to market-like strategies to operate. – Commercial activities/contracting– Social enterprise– Cause-related marketing

Problems with Marketization• The ideology of the market is essentially anti-social,

based on self-interest rather than disinterest or the public good (Anderson, 1990; Hjorth, 2009).

• The market erodes social ties other than purely economic ones and/or converts social relationships into instrumental ones (Bull et al., 2010).

• Marketization de-politicizes the public realm through economic and managerial discourses (Clarke, 2004; Curtis, 2008; Nickel, 2012; Dey & Steyeart, 2012).

Social Enterprise

• As an idea, discourse and practice has gained prominence in the past decade (or more) within the governance context.

• Clearly been linked to government downsizing/third-way efforts in the UK, Australia, US and elsewhere.

Social Enterprise• No clear consensus on the definition and meaning has

shifted over time (Teasdale, 2012)• Involves the use of market-based strategies to achieve

social goals (Kerlin, 2009).• Innovative, social value creating activity that can occur

within or across the nonprofit, business, or government sectors (Austin, Stevenson & Wei-Skillern, 2006)

• Capacity for social innovation, particularly innovations that redistribute power and wealth to create a social economy (Alvord et al., 2004).

• Combines economic, social and political/governance elements (Pestoff, 2013).

Social Enterprise

Competing discourses between those who practice it and those who set policy and fund it.– Practitioners: preoccupation with local issues,

collective action, geographical community and local power struggles

– Policy makers/funders: to promote efficiency, business discipline and financial independence.

Social Enterprise• Claims of benefits are wide and varied—from the UK Cabinet Office of the Third

Sector:– Tackle some of society’s most entrenched social and environmental

challenges– Set new standards for ethical markets, raising the bar for corporate

responsibility– Improve public services, shaping service design and pioneering new

approaches– Increase levels of enterprise, attracting new people to business

• Little research on actual impact or efficacy beyond such claims (Peattie & Morley, 2008; Bertotti et al., 2012; Teasdale, 2010). – Provide goods & services– Develop skills; create employment & experience– Use environmentally friendly practices – Develop new markets– Can build social capital, infrastructure, and engagement; but in tension with

economic development outcomes

Social EnterpriseChallenges/Problems•Generator of relatively low-skilled & low-wage jobs; creaming (Blackburn & Ram, 2006; Peattie & Morley, 2008; Teasdale, 2012).•Emphasize individual over collective—”messiah-like” figure of the social entrepreneur (Dey & Steyeart, 2010).•Can run counter to more positive social and economic outcomes (Dey & Steyaert, 2010).•Introduces a de-politicized image of social change (Curtis, 2008; Dey & Steyeart, 2010; Grenier, 2009; Nicholls, 2010).•Focus on symptoms rather than root causes (Edwards, 2008)

• Firms contribute to charity while also increasing their bottom line by tying contributions to sales.– Transactional model: for each unit sold, a business or

corporation contributes a share of proceeds to a particular cause.• e.g. Susan G. Komen pink products or Product (RED)

– In U.S., CRM expenditures almost zero in 1983; an estimated $1.78 billion in 2013.

• Benefits– Corporations

– Charities

– Consumers

Cause-Related Marketing

Problems/Challenges:•Individualizes solutions to collective problems.•Makes virtuous action easy, thoughtless & self-satisfying.•Consumers have little incentive to understand impetus for the problem being addressed through consumption.•Lulls people into a false sense of doing good, even as they are potentially doing more harm.

Cause-Related Marketing

Creating Spaces for Democratic Discourse

• “We must imagine, foster, and publicize democratic movements that reject the dominant” market discourse, “and pursue more just, more humane, and more social cooperative” futures (Purcell, 2008). – More people of diverse backgrounds participate in

organizational and societal governance; – Make participation meaningful by emphasizing

relationships and engaging individuals “routinely in civic relationships over time” and that build social capacity;

– Provide equal opportunities for individuals to participate in agenda setting, deliberation and decision-making.

Is Democratizing NGOs Enough?