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Contemporary Engineering Sciences, Vol. 11, 2018, no.

51, 2529 - 2536


HIKARI Ltd, www.m-hikari.com
https://doi.org/10.12988/ces.2018.85204

Economic Engineering and Social Innovation as

a Business Strategy for Sustainable Development

Fredy Colpas-Castillo1, Arnulfo Tarón-Dunoyer2


and Rafael Gonzalez-Cuello2
1
Faculty of Exact and Natural Sciences, University of Cartagena
Republic of Colombia
2
Food Engineering Program, University of Cartagena, Republic of Colombia

Copyright © 2018 Fredy Colpas-Castillo et al. This article is distributed under the Creative
Commons Attribution License, which permits unrestricted use, distribution, and reproduction in
any medium, provided the original work is properly cited.

Abstract

This research is descriptive and documentary where it is analyzed the context of


the economic imbalance, the generation of social innovation and the social
responsibility based on statistical data. It was investigated in the database of the
Bank of the Republic of Colombia, the United Nation (UN), the World Bank, the
National Service of Apprenticeship (SENA) and the National Administrative
Department of Statistics (DANE). Then based on the economic engineering
concepts, systemic solutions were proposed to solve socioeconomic problems
based on social innovation in the city of Cartagena (Colombia). From the
statistical data reported, it could be observed that educational gaps,
entrepreneurial capacities and levels of production and productivity in individuals
are essentially the sources of poverty, which in the future end up marking their
future. Social innovation and social responsibility are viable alternatives for
finding socioeconomic balance and sustainable development in the city of
Cartagena since unemployment has decreased until one digit in the last six years
due to the impulse of the emprender fund.

Keywords: Economic engineering, Innovation, Sustainable development

1 Introduction
Poverty is a problem that affects the humanity; different researchers throughout
history have made theoretical contributions from an epistemological point of view.
2530 Fredy Colpas-Castillo et al.

Many of these studies focus on the causes of the phenomenon, others, in turn,
emphasize the current state, its consequences and the relationship with other
variables. However, this research will focus its attention on the strategies to face
this problem, in the framework of the relationship that exists with education.
Scientific studies have been built that allow modeling the problem. In Colombia,
educational policy has been developed to achieve a more educated population and
contribute to favorable conditions for the poverty overcoming [1]. In recent years,
different organizations such as United Nations (UN), World Bank and the
International Monetary Fund are interested in overcoming poverty, especially the
extreme poverty, promoting human development, social inclusion, equity and
reducing the level of vulnerability of common people [1, 2].

Different authors developed the entrepreneurial capital notion in society and


argued that it is another productive factor that contributes to economic
development, analogously to physical and human capital. These authors stated
that innovation promoted by an entrepreneur is a determining factor in the process
of conversion of technological knowledge, which is capable of generating new
products, services, jobs, thus stimulating economic development [3, 4]. The UN
report about global development confirms that education is a key tool to eradicate
poverty and promote the prosperity. However, it is necessary to improve the
policies inside the education system. The education is the safest path to decrease
the poverty: one of the strongest results in macro-economy is that schooling
produces an increase in income ranging from 6% to 12% for each year of
education. The value of education is not limited to these achievements, also
includes other benefits such as pecuniary among others. Educated people have
better health and participate actively in civic life, and their families become
healthier and better educated.

Scientific and technological advances along with globalization of the knowledge


and the economy have become challenges for governmental institutions to
promote research, innovation, creativity and entrepreneurship processes in the
solution of problems based on knowledge application. For several decades
entrepreneurship has been linked to the discovery of profitability opportunities.
For example, Cantillon published in 1755 that entrepreneurship arises when
opportunities benefit the initial business [1, 3].

Social innovation as a generation of productivity and economic value

The concepts of the creation of shared value and social innovation are elements
that can be key to achieve a balanced economic development dimensioning the
benefits of economic activity and the generation and application of knowledge for
the benefit of the human population [6, 7]. Considering the above-mentioned
premise, many researchers have contributed to the knowledge, regarding the
generation of economic value from social innovation. Innovation is a process that
must face the challenges of society through new forms of relationships between
Economic engineering and social innovation … 2531

social actors. The main global concerns such as climate change, aging, migration
and health, among others are from an economic and social origin. In the initiative
"Union for Innovation" which aims to strengthen the companies’ ability to address
social challenges through innovation, showing that innovation in the social sector
generates productivity and economic value for society (wellness beyond GDP).
The social innovation at its maximum level of development would lead to the
reform of society to empowerment, learning and wellbeing [8]. A broader review
about the economic growth and richness creation, where the vision about the
sustainable development denies a notion of growth based exclusively on the
economic dimension [9].

The orthodox economic analysis affirms that entrepreneurs have a great influence
on economic growth. It has seen a positive relationship between entrepreneurs and
economic growth and how to enhance this economic growth it is necessary to
create an adequate social climate and a monetary policy that does not generate
inflation and encourage savings [10]. To enhance the economic growth, different
variables have been considered both economic and social variables. For example,
in a country where there are not people prepared to develop goods and services
could hardly grow in a sustained manner [10]. In this research different factors
that cause inequality and poverty in the city of Cartagena (Colombia) are analyzed
relating the gross domestic product (GDP), unemployment and education besides
the entrepreneurship as a generator of value to determine the influence of social
innovation and economic engineering on the sustainability and sustainability of
the same city.

Materials and methods


In this research is analyzed the economic imbalance, the generation of social
innovation activities and corporate social responsibility. All this analysis is based
on statistical data investigating in the different database such as Bank of the
Republic of Colombia, The UN, the World Bank, the National Apprenticeship
Service (SENA) and the National Administrative Department of Statistics
(DANE). It was built in a table and a graph to visualize the differences between
the growth of the total national GDP and the national GDP per capita. Poverty,
inequality, unemployment, population growth data were extracted from the
DANE reports. Secondary information was obtained in scientific articles,
specialized books on social innovation and sustainability. The search was carried
out with bibliographic data such as Dialnet, Scielo and Ebsco. Likewise, it was
related the approach of the different scientists with the current context of
socioeconomic and environmental problems in Colombia. Taking into account the
results shown by the republic bank, the UN, the World Bank and the DANE, the
values of the unemployment rate, indicators of poverty and inequality, extreme
poverty and the growth rate of total and regional GDP.
2532 Fredy Colpas-Castillo et al.

Results and Discussion


The entrepreneurial data reported by the Emprender fund shows that the creation
of companies for Colombians people affecting many municipalities due to
maintenance and development of new companies, which are fruitful of creativity,
inventiveness and social innovation processes. Department of Bolivar recorded
the highest growth of GDP with 10.1% in comparison with others Departments;
while 2016 that grown was above 4.0%; which means an increase close to 26 % in
the number of legal companies created. It must be noted that Cartagena and
Bolivar contribute with 4.33% of the national GDP of Colombia besides it is the
largest economy of the Colombian Caribbean Coast.

This region contributes the most to the GDP among the eight departments of the
Caribbean. However, this contribution is not reflected in the welfare of its
inhabitants due to the high data poverty found in Cartagena and Bolivar.
Concerning university studies were found low levels of investment in research,
development and innovation, moreover Colombia must solve the lack of
articulation between them.
In Colombia, less than 0.8% of GDP is invested for innovation and only 35% of
these resources come from the private sector because the percentage of companies
that carry out investigations is less than 22% according to the first Ranking of
Business Innovation carried out by Dinero and Andi magazine in 2105.
For 2016, the proportion of people economically active who had completed
secondary education was 32.9%; while, 23.3% had completed primary basic
education, 6.0% secondary basic education, 10.9% professional technical or
technological education, 7.7 % university education and 3.3% postgraduate. In
Colombia, the population increase is greater than the real gross domestic product
(GDPr) according to the DANE report, so the per capita domestic product shows a
lower GDPr increase, which is an indicator of a low-level economy. Likewise, the
migration of people from Venezuela and other foreigners raise the Colombian
citizen (Table 2).

Table 1. Behavior of gross domestic product last five years

(At constant 2005 prices)


Total Per inhabitant
Thousands
of
Millions
of pesos Variation Millions of Pesos Variation Dollars
End of: annual % dollars annual % de 2005
2005

2013 493.831 4.87 212.788 10.480.837 3.68 4.516


2014 515.528 4.39 222.137 10.816.380 3.20 4.661
Economic engineering and social innovation … 2533

Table 1. (Continued): Behavior of gross domestic product last five years

2015 (p) 531.262 3.05 228.916 11.021.255 1.89 4.749


2016 (p) 542.116 2.04 233.593 11.120.851 0.90 4.792
2017 (p) 551.701 1.77 237.723 11.192.595 0.65 4.823

(p) Provisional. Note: GDP in 2005 dollars = GDP in millions of pesos of 2005 on the nominal
exchange rate. Source: DANE -Direction of Synthesis and National Accounts and Bank of the
Republic.

Table 2. Annual variation of Colombia's population growth

Year

2017 2016 2015 2014 2013


Population 49.291.609 48.747.708 48.203.405 47.661.787 47.121.089

Source. National Department of Statistics (DANE). Bank of republic - Technical Management -


information extracted from the data warehouse

The employment rate (employment rate) refers to the percentage ratio between the
employed population and the working-age population, while the unemployment
rate is the percentage ratio between the number of unemployed persons and the
economically active population. In the analysis of the unemployment rate in
Colombia, it is necessary to pay attention to the lack of employment in the
agriculture sector, since the data report the lack of opportunities so that it is
required a product development in the rural areas considering the demographic
growth and the exodus of Venezuelans to Colombia.

Figure 1. Comparison of Total National GDP and National GDP Per capita.
Source: DANE
2534 Fredy Colpas-Castillo et al.

Table 3. Variation in the unemployment rate in Colombia

Year
Unemployment 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008
rate (%)
9.44 8.63 8.74 8.59 8.72 8.44 9.55 9.82 11.12 11.31 10.61

Source: Bank of the republic.

Table 4. Unemployment rate in Cartagena (Colombia).

Year
Unemployment 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006
rate (%) 9.0 8.6 10.7 9.5 10.6 12.7 12.5 11.8 14.6 13.7

Source: DANE.

The financing data of entrepreneurship were reported by the Emprender fund,


which is characterized as a seed capital fund. In 2017, 1291 companies were
supported, 24 municipalities were benefited.

Higher education and social innovation in the city of Cartagena

In Cartagena-Colombia are located 13 higher education institutions (HEIs). In all


of these institutions, the entrepreneurship subject is considered as a transversal
axis for encouraging competencies indicated in Law 1014 of 2006. Additionally,
there are other academic spaces dedicated to the promotion of the entrepreneurial
culture and the development of associated attitudes and competencies, which
correspond to an average of 25.8 credits, distributed in an average of 9.2 spaces.
In this regard, it is concluded that the private university devotes more academic
credits and spaces to the teaching of entrepreneurship than the public university.
The strategic guidelines established for each program were analyzed, finding a
reason to be and the value promise, which indicates a commitment to form
integral professionals, entrepreneurs and innovators capable of generating a
company [1].

Conclusion
Educational gaps, entrepreneurship capacities, production levels and productivity
by each person are essentially the causes of poverty, which in the future
determines income levels and therefore increase the levels of inequality in the
population. According to the unemployment data rate, it can be seen that the
social entrepreneurship programs have decreased their values since 2011, but they
have not been able to resolve the problem. Finally, it is concluded that social innova-
Economic engineering and social innovation … 2535

tion and corporate social responsibility are viable alternatives for finding
socioeconomic balance and sustainable development in the city of Cartagena-
Colombia since unemployment has decreased to one digit in the last six years as a
result of the momentum of the emprender fund.

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Received: May 15, 2018; Published: July 14, 2018