Nonprofit Management

Nonprofit management studies the governance and management of nonprofit and voluntary organizations and the third sector.

Scope

It covers the nonprofit form, governance and accountability, fundraising and finance, and nonprofit-government relations.

Core questions

• Why do nonprofit organizations exist?
• How are nonprofits governed and managed?
• How do nonprofits relate to government?
• How is the third sector financed and held accountable?

Key concepts

• Nonprofit form
• Contract failure
• Third sector
• Governance
• Voluntarism
• Government-nonprofit relations

Key theories

Why nonprofits exist

Hansmann explained the nonprofit form as a response to 'contract failure' under information asymmetry.

Government-nonprofit partnership

Salamon analysed the extensive partnership between government and nonprofits in welfare provision.

History

Nonprofit studies developed economic theories of the nonprofit form (Hansmann) and analyses of the third sector and its partnership with government (Salamon).

Debates

Independent sector or government partner?

Whether nonprofits are an autonomous civil-society sector or extensions of public provision.

Key figures

• Henry Hansmann
• Lester Salamon

Seminal works

• hansmann-1980
• salamon-1995

Frequently asked questions

What is contract failure?

Hansmann's explanation that nonprofits arise where buyers cannot easily judge service quality, and the nonprofit form's non-distribution constraint builds trust.