Navigating Moral Boundaries: Repugnance Entrepreneurs and The Legitimization of Repugnant Transactions

The concept of repugnant transactions, i.e., transactions that are commonly considered morally or socially objectionable, presents a significant arena where entrepreneurs can profit from exploiting interstices in prevailing norms, challenge such norms, and potentially affect institutional change. Building on the literature on repugnant transactions, moral markets, and stigmatized industries, we introduce the notion of repugnance entrepreneur, which encapsulates the dynamic agency of entrepreneurs and their transformative role in reshaping institutionally determined legitimacy within their respective industries. Drawing on insights from institutional theories, we introduce a framework that comprises three dimensions of repugnant transactions and predicts that repugnance entrepreneurs challenge industry norms, triggering societal responses and potentially driving institutional change. We thus enrich our understanding of the entrepreneurial micro-foundations driving legitimacy-change and offer valuable insights for entrepreneurs and scholars navigating the intricate terrain of repugnant transactions and stigmatized industries.