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The Roles of Government and Nonprofit Suppliers in Mixed Industries

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  • Kanika Kapur
  • Burton A. Weisbrod

Abstract

In what ways, if any, does the behavior of government and nonprofit organizations differ? This paper examines evidence from two industries‹nursing homes and mentally handicapped facilities‹to determine whether government and nonprofit organization behavior differs in identifiable dimensions, and if it does, why the differences occur. Behavior is studied in terms of consumer access, as measured by the use of waiting lists, and output quality, as measured by consumer satisfaction. Considerable differential behavior across the two institutional forms is found in both industries. The differences are consistent with varied models, one of which is that government and nonprofit providers have different objective functions, trading off quality and consumer access differently as government pursues a supplier-of-last-resort role.

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Paper provided by Institute for Policy Resarch at Northwestern University in its series IPR working papers with number 99-9.

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Handle: RePEc:wop:nwuipr:99-9

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References

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  1. Richard Steinberg & Burton A. Weisbrod, . "Pricing and Rationing by Nonprofit Organizations with Distributional Objectives," IPR working papers, Institute for Policy Resarch at Northwestern University 97-28, Institute for Policy Resarch at Northwestern University.
  2. Paul J. Devereux & Burton A. Weisbrod, . "Complaints and Geographic Mobility as Responses to Dissatisfaction with Public Services," IPR working papers, Institute for Policy Resarch at Northwestern University 96-20, Institute for Policy Resarch at Northwestern University.
  3. Richard G. Frank & David S. Salkever, 1994. "Nonprofit Organizations in the Health Sector," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 8(4), pages 129-144, Fall.
  4. Armen A. Alchian & Harold Demsetz, 1971. "Production, Information Costs and Economic Organizations," UCLA Economics Working Papers, UCLA Department of Economics 10A, UCLA Department of Economics.
  5. Badelt, Christoph & Weiss, Peter, 1990. "Specialization, Product Differentiation and Ownership Structure in Personal Social Services: The Case of Nursery Schools," Kyklos, Wiley Blackwell, Wiley Blackwell, vol. 43(1), pages 69-89.
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Cited by:
  1. Jody Sindelar & Todd Olmstead, 2004. "Does the Impact of Managed Care on Substance Abuse Treatment Services Vary By Profit Status?," NBER Working Papers 10745, National Bureau of Economic Research, Inc.
  2. Laura Di Giorgio & Massimo Filippini & Giuliano Masiero, 2012. "The impact of the institutional form on the cost efficiency of nursing homes," Quaderni della facoltà di Scienze economiche dell'Università di Lugano, USI Università della Svizzera italiana 1203, USI Università della Svizzera italiana.
  3. Burcay Erus & Burton Weisbrod, 2003. "Objective Functions and Compensation Structures in Nonprofit and For-Profit Organizations. Evidence from the “Mixed” Hospital Industry," NBER Chapters, in: The Governance of Not-for-Profit Organizations, pages 117-142 National Bureau of Economic Research, Inc.
  4. Steinberg, Richard & Weisbrod, Burton A., 2005. "Nonprofits with distributional objectives: price discrimination and corner solutions," Journal of Public Economics, Elsevier, Elsevier, vol. 89(11-12), pages 2205-2230, December.
  5. Chau, Nancy H. & Huysentruyt, Marieke, 2006. "Nonprofits and public good provision: A contest based on compromises," European Economic Review, Elsevier, Elsevier, vol. 50(8), pages 1909-1935, November.
  6. Ballou, Jeffrey P. & Weisbrod, Burton A., 2003. "Managerial rewards and the behavior of for-profit, governmental, and nonprofit organizations: evidence from the hospital industry," Journal of Public Economics, Elsevier, Elsevier, vol. 87(9-10), pages 1895-1920, September.
  7. Shabbar Jaffry & Alexandros Apostolakis, 2011. "Evaluating individual preferences for the British Museum," Journal of Cultural Economics, Springer, Springer, vol. 35(1), pages 49-75, February.
  8. Lam, Marcus & Klein, Sacha & Freisthler, Bridget & Weiss, Robert E., 2013. "Child center closures: Does nonprofit status provide a comparative advantage?," Children and Youth Services Review, Elsevier, Elsevier, vol. 35(3), pages 525-534.

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