Comparing Government Social Welfare Service Acquisition Regimes: Marketisation and Bases for Competition in Canadian and English Homelessness

When governments acquire third-party social welfare services (SWS), they create institutions of acquisition. The rules and practices that governments adopt define who is able to participate, on what basis, and how prices are determined. This paper conceptualizes the institutions of SWS acquisition, their variations, and implications, in order to contribute to a deeper understanding of the link between contracting and nonprofit commercialisation. Institutions of SWS acquisition include rules of entry, participation, and assessment. Resulting acquisition regimes can be marketised to a greater or lesser extent, and this is influential through its effect on nonprofit competition. Drawing on interviews with public servants and nonprofit staff, the paper compares acquisition regimes for homelessness services in England, a regime that closely resembles a market, and Canada, a regime which is not marketised. In contrast to their non-marketised counterparts, this paper finds that marketised SWS acquisition regimes create incentives for participants to reduce prices by loss-leading or ratcheting down service quality.

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

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.

Exploring the Dimensions of Nonprofit Competition through its Supplementary, Complementary, and Adversarial Relationships with Government

Nonprofits contribute to communities and society through service delivery, innovation, knowledge-building, and civic engagement. They frequently partner with and push government to better serve its citizens through relationships that have been characterized as supplementary, complementary, and adversarial (Young 2006). In all of these roles and relationships, nonprofits must compete for resources, time, and attention with other nonprofits, government entities, and for-profit organizations within communities, nationally, and internationally. Competition sometimes shapes and sometimes is shaped by public policies that affect the rules of the game. In this conceptual paper, we explore the dimensions of nonprofit competition and the implications for the nonprofit–government supplementary, complementary, and adversarial relationships.

Overcoming the Cause of Failure and the Role of Issue Salience: Toward a Comprehensive Theory for Nonprofit Activity and Competition in a Three-Sector Economy

This paper extends the theoretical framework of nonprofit activity in three-sector economies. Perspectives from existing theories on nonprofit organizations and the agenda setting literature are simultaneously considered. The nonprofit form provides one solution to the causes of market failure that are inherent to the different classes of goods discussed by previous theory. However, issue salience can lead to public policies that correct market failures. Such policies can lead to greater competition for tax-supported funding and to for-profit entry. This combined framework allows for the integration of the various theories on the existence of nonprofit organizations under one theoretical lens. It also yields a framework to empirically analyze industry dynamics and inter-organizational competition specifically within nonprofit and mixed-sector markets. The temporal variation and relative strength of issue salience in various mission areas in which nonprofits participate are particularly considered. This theoretical perspective leads to several important implications for industrial structure, nonprofit competition for resources and market share, public policy, advocacy, contracting, and public–private partnerships as the issues nonprofits address evolve over time.