Use and Perceptions of the Availability of Local Government and Nonprofit Services in Diverse Urban Settings

This analysis tests fundamental nonprofit theory using individual-level demand-side data, which complements existing studies that have relied on organizational- and community-level variables alone. We use survey and administrative data to test the relationship between individuals’ perceptions and use of local government services and their reported use of nonprofit services, controlling for the density of organizations around respondents’ addresses. Individuals who report being better served by government services are significantly more likely to report using nonprofit services—while individuals who report being unserved by government are also less likely to report access to nonprofits, despite the actual density of organizations around them. These findings support theories of interdependence between government and nonprofit sectors. However, income-based disparities in perceived access to nonprofit services highlight persistent gaps in serving all individuals on the local level.

An Institutional Theory of the Nonprofit

The evolution of activity within the nonprofit sector (and nonprofit-type activity without the sector) has outpaced the ability of nonprofit theory to describe it. In contrast to legalistic, sector-based theories of the nonprofit, this article proposes an institutional theory of the nonprofit that defines its distinction from public and private institutions through (a) the voluntary (rather than coercive) assignment of roles and (b) the use of the good or service by non-payers. The voluntary and redistributive nature of such nonprofit-type institutions makes them primarily compatible with the distribution of goods that are non-subtractable and excludable (toll goods).