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The economics of non-governmental organisations

Author

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  • Scott, Colin
  • Hopkins, R.

Abstract

The purpose of this paper is to identify the organisational comparative advantage of NGOs, and to develop a model which explains the set of circumstances uder which they emerge and dominate other types of firms. It is argued that the potential superiority of NGOs derives from two features: (1) the creation of an institutional environment within the firm which selectively attracts altruists, who have a lower supply price of effective labour than egotists, and (2) the ability to develop efficient technologies for converting the relevatory and productive effort of their staff into local outputs which are highly valued by the target group of beneficiaries.

Suggested Citation

  • Scott, Colin & Hopkins, R., 1999. "The economics of non-governmental organisations," LSE Research Online Documents on Economics 6672, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:6672
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    File URL: http://eprints.lse.ac.uk/6672/
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    References listed on IDEAS

    as
    1. Susan Rose-Ackerman, 1996. "Altruism, Nonprofits, and Economic Theory," Journal of Economic Literature, American Economic Association, vol. 34(2), pages 701-728, June.
    2. Cornes,Richard & Sandler,Todd, 1996. "The Theory of Externalities, Public Goods, and Club Goods," Cambridge Books, Cambridge University Press, number 9780521477185.
    3. Andreoni, James, 1990. "Impure Altruism and Donations to Public Goods: A Theory of Warm-Glow Giving?," Economic Journal, Royal Economic Society, vol. 100(401), pages 464-477, June.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Barr, Abigail & Fafchamps, Marcel & Owens, Trudy, 2005. "The governance of non-governmental organizations in Uganda," World Development, Elsevier, vol. 33(4), pages 657-679, April.
    2. Campos, Nauro F & Khan, Feisal U & Tessendorf, Jennifer E, 2004. "From substitution to complementarity: some econometric evidence on the evolving NGO-State relationship in Pakistan," Journal of Developing Areas, Tennessee State University, College of Business, vol. 37(2), pages 49-72, January-M.
    3. Abigail Barr & Marcel Fafchamps & Trudy Owens, 2004. "The Resources and Governance of Non-Governmental Organizations in Uganda," Development and Comp Systems 0409047, University Library of Munich, Germany.
    4. Glaser Darrell J. & Rahman Ahmed S. & Smith Katherine A. & Chan Daniel W., 2013. "Product Differentiation and Consumer Surplus in the Microfinance Industry," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 13(2), pages 991-1022, August.

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    More about this item

    Keywords

    miroeconomic analyses of economic development; formal and informal sectors; non-governmental organisations; institutional arrangements; non-profit institutions; altruism;
    All these keywords.

    JEL classification:

    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers

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