Volunteer hiring, organizational form and the provision of mission-oriented goods
AbstractMission-oriented organizations, such as nonprofit organizations and NGOs, rely critically on volunteer recruitment to achieve their organizational goals. Besides serving as an outlet of altruistic motives, volunteering often acts as a stepping-stone for a paid position in the nonprofit sector. This paper provides an explanation for the fact that nonprofit employers are uniquely able to attract such volunteers with social concerns and career aspirations and for the related observation that nonprofits figure prominently in mission-related activities. Our theory is predicated on that - by committing to not distributing profits - nonprofit incorporation relaxes the incentive constraint that employers face when implicitly contracting with volunteers, without relying on ex ante differences in workers' preferences over the employer's identity or inherent asymmetries between nonprofit and for-profit providers. The not-for-profit commitment is shown to be effective only in activities where producers, who can choose to be for-profit or nonprofit, care about the level or quality of the service being provided. Thus, in the equilibrium of the model developed here nonprofit entry in sectors where missions play a defining role and the hiring of volunteers arise endogenously due to economic forces. This equilibrium outcome has some desirable welfare properties. Keywords; volunteers, nonprofit institutions, privately provided public goods
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Economics Division, School of Social Sciences, University of Southampton in its series Discussion Paper Series In Economics And Econometrics with number 0707.
Date of creation: 01 Sep 2007
Date of revision:
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.:
- George A. Akerlof & Rachel E. Kranton, 2005. "Identity and the Economics of Organizations," Journal of Economic Perspectives, American Economic Association, vol. 19(1), pages 9-32, Winter.
- 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.
- Jonathan Levin, 2000.
"Relational Incentive Contracts,"
01002, Stanford University, Department of Economics.
- Josse Delfgaauw & Robert Dur, 2003.
"Signaling and Screening of Workers' motivation,"
CESifo Working Paper Series
1099, CESifo Group Munich.
- Francois, Patrick, 2000. "'Public service motivation' as an argument for government provision," Journal of Public Economics, Elsevier, vol. 78(3), pages 275-299, November.
- Timothy Besley & Maitreesh Ghatak, 2005.
"Competition and Incentives with Motivated Agents,"
American Economic Review,
American Economic Association, vol. 95(3), pages 616-636, June.
- Besley, Tim & Ghatak, Maitreesh, 2005. "Competition and incentives with motivated agents," Open Access publications from London School of Economics and Political Science http://eprints.lse.ac.uk/, London School of Economics and Political Science.
- Besley, Timothy J. & Ghatak, Maitreesh, 2004. "Competition and Incentives with Motivated Agents," CEPR Discussion Papers 4641, C.E.P.R. Discussion Papers.
- Kathleen Day & Rose Annue Devlin, 1998.
"The Payoff to Work without Pay: Volunteer Work as an Investment in Human Capital,"
Canadian Journal of Economics,
Canadian Economics Association, vol. 31(5), pages 1179-1191, November.
- Day, K.M. & Devlin, R.A., 1993. "The Payoff to Work without Pay: Volunteer Work as an Investment in Human Capital," Working Papers 9310e, University of Ottawa, Department of Economics.
- Colin Rowat and Paul Seabright, 2005.
"Intermediation by aid agencies,"
05-16, Department of Economics, University of Birmingham.
- Rowat, Colin & Seabright, Paul, 2006. "Intermediation by Aid Agencies," Open Access publications from University of Toulouse 1 Capitole http://neeo.univ-tlse1.fr, University of Toulouse 1 Capitole.
- Colin Rowat & Paul Seabright, 2004. "Intermediation by aid agencies," Industrial Organization 0412007, EconWPA.
- Rowat, Colin & Seabright, Paul, 2004. "Intermediation by Aid Agencies," CEPR Discussion Papers 4781, C.E.P.R. Discussion Papers.
- Patrick Francois, 2002.
"Not-for-profit Provision of Public Services,"
The Centre for Market and Public Organisation
02/060, Department of Economics, University of Bristol, UK.
- Carmichael, H Lorne, 1989. "Self-Enforcing Contracts, Shirking, and Life Cycle Incentives," Journal of Economic Perspectives, American Economic Association, vol. 3(4), pages 65-83, Fall.
- Roth, Alvin E, 1984. "The Evolution of the Labor Market for Medical Interns and Residents: A Case Study in Game Theory," Journal of Political Economy, University of Chicago Press, vol. 92(6), pages 991-1016, December.
- Kevin Murdock, 2002. "Intrinsic Motivation and Optimal Incentive Contracts," RAND Journal of Economics, The RAND Corporation, vol. 33(4), pages 650-671, Winter.
- Leete, Laura, 2001. "Whither the Nonprofit Wage Differential? Estimates from the 1990 Census," Journal of Labor Economics, University of Chicago Press, vol. 19(1), pages 136-70, January.
- Buurman, Margaretha & Dur, Robert, 2008.
"Incentives and the Sorting of Altruistic Agents into Street-Level Bureaucracies,"
IZA Discussion Papers
3847, Institute for the Study of Labor (IZA).
- Margaretha Buurman & Robert Dur, 2012. "Incentives and the Sorting of Altruistic Agents into Street-Level Bureaucracies," Scandinavian Journal of Economics, Wiley Blackwell, vol. 114(4), pages 1318-1345, December.
- Margaretha Buurman & Robert Dur, 2008. "Incentives and the Sorting of Altruistic Agents into Street-Level Bureaucracies," Tinbergen Institute Discussion Papers 08-113/1, Tinbergen Institute, revised 14 Oct 2010.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Chris Thorn).
If references are entirely missing, you can add them using this form.