Increasing the Size of the Pie: The Impact of Crowding on Nonprofit Sector Resources

Abstract

The number of nonprofit organizations is rapidly increasing, which has led nonprofit practitioners to complain of funding scarcity, nonprofit scholars to closely study nonprofit competition, and policymakers to consider increasing nonprofit barriers to entry. Underlying each of these perspectives is an assumption of limited financial resources. We empirically examine this assumption using county-level panel data on nonprofit human services organizations from the National Center for Charitable Statistics. Contrary to the limited resources assumption, our fixed-effects models show that increasing nonprofit density, at its current levels, has the effect of increasing sector financial resources in each county. We suggest that these findings prompt a tradeoff for policymakers. A sector with free market entry results in a nonprofit sector with more, smaller nonprofits, but such a sector may have the capacity to serve more people because it has more total sector financial resources. Conversely, a sector with higher barriers to entry would translate to a sector with fewer, larger nonprofits with less overall capacity due to fewer sector financial resources.

Considering the effectiveness of philanthropic collective action: a community ecology perspective

“…To measure philanthropic collective action for community education, all monetary contributions to educational nonprofit organizations is aggregated at the county level by following the community ecology perspective. An indicator of our dependent variable summing all funds to local nonprofits is widely used to measure community philanthropy within a geographic community (Beaton and Hwang, 2017; Longhofer et al , 2018). Educational nonprofit organizations are classified according to the National Taxonomy of Exempt Entities Core Codes (NTEE-CC) classification system via the IRS tax exemption code.…”

Factors Influencing the Size of Non-Profit Sector: An Empirical Study

“…Başka bir faktör, devletin genel tüketim harcamalarının GDP'ye oranıdır. Kâr amacı gütmeyen sektör kuruluşlarının devletin hizmetlerindeki yetersizlik nedeniyle ortaya çıktığı varsayıldığında, devletin genel tüketim harcamalarında ortaya çıkacak bir artışın, kâr amacı gütmeyen sektörün büyüklüğünü küçültebileceği beklenebilmektedir (Beaton & Hwang, 2017;Paarlberg & Yoshioka 2016;Lecy & Van Slyke, 2013). Bir diğer faktör, ülkelerdeki eğitim oranlarıdır.…”

The Energy Boom: Boon or Bane for Local Philanthropy?

“…In 2014, nonprofit organizations with less than $50,000 in annual revenue are not required to file a 990 form with the IRS, but in 2003, nonprofit organizations with more than $25,000 were required to file a 990 form. Our dependent variable is a per capita measure of the sum of monetary contributions to nonprofit organizations nested in counties (Beaton and Hwang, ; Paarlberg and Hwang, ).…”