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Not-for-profit Provision of Public Services

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Author Info
Patrick Francois ()

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Abstract

Not-for-profit firms are greatly over-represented in the childcare, medical care, education and care for the aged sectors where service providing workers, as well as purchasers, seem to care about the level or quality of service being provided. Since all individuals who care about service levels receive non-excludable benefits, these services have a public good element. Such care can be used to motivate employees to perform tasks beyond their strict job description. But such care only motivates effort if workers believe it affects the final level of provision. Since nonprofit status ensures management is not directly concerned with profit, or not answerable to owners with such concerns, it ensures workers' efforts 'matter' by committing the firm to not expropriating extra worker effort to lower costs or raise profits. Nonprofit firms can thus motivate their work force in a way that for-profit firms cannot match.

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File URL: http://www.bris.ac.uk/Depts/CMPO/workingpapers/wp60.pdf
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Publisher Info
Paper provided by Department of Economics, University of Bristol, UK in its series The Centre for Market and Public Organisation with number 02/060.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length: 10 pages
Date of creation: Sep 2002
Date of revision:
Handle: RePEc:bri:cmpowp:02/060

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Postal: 2 Priory Road, Bristol, BS8 1TX
Phone: 0117 33 10799
Fax: 0117 33 10705
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Web page: http://www.bris.ac.uk/cmpo/
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Related research
Keywords: structure; scope of government; publicly provided private good; altruism;

Other versions of this item:

Find related papers by JEL classification:
H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
D64 - Microeconomics - - Welfare Economics - - - Altruism

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Hart, Oliver & Shleifer, Andrei & Vishny, Robert W, 1997. "The Proper Scope of Government: Theory and an Application to Prisons," The Quarterly Journal of Economics, MIT Press, vol. 112(4), pages 1127-61, November.
    Other versions:
  2. Armen A. Alchian & Harold Demsetz, 1971. "Production, Information Costs and Economic Organizations," UCLA Economics Working Papers 10A, UCLA Department of Economics. [Downloadable!]
    Other versions:
  3. Francois, Patrick, 2000. "'Public service motivation' as an argument for government provision," Journal of Public Economics, Elsevier, vol. 78(3), pages 275-299, November. [Downloadable!] (restricted)
  4. Patrick Francois, 2001. "Employee Care and the Role of Nonprofit Organizations," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 157(3), pages 443-, September.
  5. H. Naci Mocan & Erdal Tekin, 2000. "Nonprofit Sector and Part-Time Work: An Analysis of Employer-Employee Matched Data of Child Care Workers," NBER Working Papers 7977, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Patrick Francois, 2004. "'Making a Difference': Labor Donations in the Production of Public Goods," The Centre for Market and Public Organisation 04/093, Department of Economics, University of Bristol, UK. [Downloadable!]
  2. Rossella Levaggi & Michele Moretto & Vincenzo Rebba, 2007. "Investment decisions in hospital technology when physicians are devoted workers," "Marco Fanno" Working Papers 0048, Dipartimento di Scienze Economiche "Marco Fanno". [Downloadable!]
    Other versions:
  3. Paul Gregg & Paul A. Grout & Anita Ratcliffe & Sarah Smith & Frank Windmeijer, 2008. "How important is pro-social behaviour in the delivery of public services?," The Centre for Market and Public Organisation 08/197, Department of Economics, University of Bristol, UK. [Downloadable!]
  4. Cuccia, Tiziana & Cellini, Roberto, 2007. "Workers' enterprises in the case of arts production," MPRA Paper 5192, University Library of Munich, Germany. [Downloadable!]
  5. Francois, Patrick, 2005. "Making A Difference," CEPR Discussion Papers 5158, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  6. Herbst, P. & Prufer, J., 2007. "Firms, Nonprofits and Cooperatives: A Theory of Organizational Choice," Discussion Paper 2007-003, Tilburg University, Tilburg Law and Economic Center. [Downloadable!]
    Other versions:
  7. Paul A Grout & Margaret Stevens, 2003. "Financing and Managing Public Services: An Assessment," The Centre for Market and Public Organisation 03/076, Department of Economics, University of Bristol, UK. [Downloadable!]
  8. Robert A. J. Dur & Amihai Glazer, 2004. "Optimal Incentive Contracts For a Worker Who Envies His Boss," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
  9. Colin Rowat & Paul Seabright, 2004. "Intermediation by aid agencies," Industrial Organization 0412007, EconWPA. [Downloadable!]
    Other versions:
  10. Prufer, J., 2007. "Competition and Mergers among Nonprofits," Discussion Paper 2007-022, Tilburg University, Tilburg Law and Economic Center. [Downloadable!]
    Other versions:
  11. Gregory E. Goering, 2007. "The strategic use of managerial incentives in a non-profit firm mixed duopoly," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 28(2), pages 83-91. [Downloadable!]
  12. Naoki Yoshihara, 2008. "A Theory of Political Competition over Military Policy and Income Redistribution," Discussion Paper Series a503, Institute of Economic Research, Hitotsubashi University. [Downloadable!]
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