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Agency Consequences of Government Funding in Nonprofit Organizations

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  • S. VERBRUGGEN

    ()

  • K. VLASSENROOT
  • J. CHRISTIAENS
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    Abstract

    Nonprofit organizations often rely on governmental grants to finance their social programs. Under certain circumstances, the procurement of these grants causes an agency-relation between the board of directors and the management of the organization. Using archival data from a substantial number of nonprofit organizations’ financial statements, the influence of different types of government grants on the agency-relation between board and management is tested. The study reveals an increase in the agency-relationship depending on the level of efforts necessary to achieve the grants.

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    File URL: http://www.feb.ugent.be/nl/Ondz/wp/Papers/wp_11_711.pdf
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    Bibliographic Info

    Paper provided by Ghent University, Faculty of Economics and Business Administration in its series Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium with number 11/711.

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    Length: 29 pages
    Date of creation: Feb 2011
    Date of revision:
    Handle: RePEc:rug:rugwps:11/711

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