IDEAS home Printed from https://ideas.repec.org/a/oup/jleorg/v17y2001i2p507-20.html
   My bibliography  Save this article

The Phantom Profits of the Opera: Nonprofit Ownership in the Arts as a Make-Buy Decision

Author

Listed:
  • Kuan, Jennifer

Abstract

This article applies contract-theory to explain why nonprofits exist and how they compete for profits. Existing theories about nonprofits either assume that nonprofit organizations engage in "unprofitable" businesses and therefore rely on philanthropy and altruism, or that nonprofits can overcome severe informational asymmetries that for-profits cannot. Instead, I argue that nonprofits arise when consumers integrate into production; consumers, supported by institutions, organize to produce a nonrival good for their own consumption, and in so doing are able to achieve first-best. This modeling approach, developed in the context of classical performing arts, may have application in other industries in which nonprofits compete, such as health care, research and development (R&D), and education. Copyright 2001 by Oxford University Press.

Suggested Citation

  • Kuan, Jennifer, 2001. "The Phantom Profits of the Opera: Nonprofit Ownership in the Arts as a Make-Buy Decision," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 17(2), pages 507-520, October.
    • Handle: RePEc:oup:jleorg:v:17:y:2001:i:2:p:507-20
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jens Prüfer, 2011. "Competition And Mergers Among Nonprofits," Journal of Competition Law and Economics, Oxford University Press, vol. 7(1), pages 69-92.
    2. Patrick HERBST & Jens PRUFER, 2016. "Firms, Nonprofits, And Cooperatives: A Theory Of Organizational Choice," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 87(3), pages 315-343, December.
    3. Jiao Luo & Aseem Kaul, 2019. "Private action in public interest: The comparative governance of social issues," Strategic Management Journal, Wiley Blackwell, vol. 40(4), pages 476-502, April.
    4. Bruce Seaman, 2004. "Competition and the Non-Profit Arts: The Lost Industrial Organization Agenda," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 28(3), pages 167-193, August.
    5. Monica Auteri & Richard Wagner, 2007. "The Organizational Architecture of Nonprofit Governance: Economic Calculation Within an Ecology of Enterprises," Public Organization Review, Springer, vol. 7(1), pages 57-68, March.
    6. Diamond, Stephen F. & Kuan, Jennifer W., 2018. "Are the stock markets “rigged”? An empirical analysis of regulatory change," International Review of Law and Economics, Elsevier, vol. 55(C), pages 33-40.
    7. repec:pri:cpanda:wp30-dimaggio is not listed on IDEAS
    8. Paul DiMaggio, 2003. "Nonprofit Organizations and the Intersectoral Division of Labor in the Arts," Working Papers 37, Princeton University, School of Public and International Affairs, Center for Arts and Cultural Policy Studies..

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:jleorg:v:17:y:2001:i:2:p:507-20. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press (email available below). General contact details of provider: https://academic.oup.com/jleo .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.