Urban-rural economic inequality: is social entrepreneurship the solution?

Purpose “Reduce inequality” is a prominent goal in the 2030 Agenda for Sustainable Development of the United Nations and holds significant importance in the global policy discourse. Combined with the dual economy theory, this study aims to examine whether social entrepreneurship is the solution to urban-rural economic inequality. Design/methodology/approach This paper uses panel data from 31 provinces in China between 2011 and 2021 and employs a mediation effect model, instrumental variable model and a spatial Durbin model to explore the impact of social entrepreneurship on urban-rural economic inequality. Findings We find that the growth of social entrepreneurship activities correlates with a reduction in economic inequality. Moreover, our results suggest that social entrepreneurship reduces economic inequality by accelerating the process of population urbanization, enhancing non-farm employment and increasing rural income. However, our results reveal that social entrepreneurship has a limited spatial spillover effect. Originality/value Our research extends the existing literature on the reduction of urban-rural economic inequality by introducing the role of social entrepreneurship. The empirical results provide implications to enrich the discussion of urban-rural integration and sustainable development.