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Firms, Nonprofits and Cooperatives: A Theory of Organizational Choice Author info | Abstract | Publisher info | Download info | Related research | Statistics Herbst, P.
Prufer, J. (Tilburg University, Tilburg Law and Economics Center)
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Abstract This paper formalizes the difference between firms, nonprofits, and cooperatives and identifies optimal organizational choice. In a model of quality provision, we find a clear ranking of quality produced: Firms provide lowest and nonprofits highest levels of quality. Efficiency, however, depends on the competitive environment, the decision making process and technology. Cooperatives are optimal when decision making costs are low. Else, cooperatives are increasingly dominated by either nonprofits or firms (depending on the incremental costs of quality production). Finally, changes in the competitive environment affect organizational choice: Increased competition induces a shift towards firm organization and away from nonprofits. JEL codes: L21, L31, D23 Keywords: Theory of the Firm, Cooperatives, Nonprofits, Organizational Choice, organizational change
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Paper provided by Tilburg University, Tilburg Law and Economic Center in its series Discussion Paper with number
2007-003.
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Date of creation: 2007Date of revision:
Handle: RePEc:dgr:kubtil:2007003Contact details of provider: Web page: http://www.tilburguniversity.nl/tilec/
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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.)
Prufer, J., 2007.
"Competition and Mergers among Nonprofits ,"
Discussion Paper
2007-022, Tilburg University, Tilburg Law and Economic Center.
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