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This paper argues that, in divided societies, social entrepreneurship can be an effective strategy for regional development if it is integrated with conflict engagement. It views both social entrepreneurship and conflict engagement through a social constructionist lens and employs theory building methods from action research and programme theory evaluation. The argument is presented in the form of a ‘programme theory of action’, called the ‘Studio for Social Creativity’ that provides the conceptual and practical basis for promoting development in Israel's northern periphery, a region characterized by socio-economic stagnation as well as deep social divisions, especially between Jewish and Arab Palestinian inhabitants. The programme theory of action includes a description of the context, the problem framing, underlying assumptions, action strategies and intended outcomes. It hypothesizes that integrating social entrepreneurship and conflict engagement impacts regional development by redefining inter-group relationships, enhancing social networks, activating social capital, leveraging diversity and challenging existing power structures.
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