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Rational Nonprofit Entrepreneurship

Listed author(s):
  • Bilodeau, M.
  • Slivinsky, A.

This paper derives the decision to found a nonprofit firm as the equilibrium outcome of a multistage game among individuals who would like a public good to be provided. The model predicts that if individuals will voluntarily contribute towards provision of the public good, then it is in the private interest of the entrepreneur to impose a non-distribution constraint on herself by founding a nonprofit firm. This decision also results in greater voluntary contributions than if the firm is proprietary.

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Paper provided by Departement d'Economique de l'École de gestion à l'Université de Sherbrooke in its series Cahiers de recherche with number 94-02a.

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Length: 35 pages
Date of creation: 1994
Handle: RePEc:shr:wpaper:94-02a
Contact details of provider: Postal:
Sherbrooke, Québec, J1K 2R1

Phone: (819) 821-7233
Fax: (819) 821-6930
Web page: http://www.gredi.org/home/documents-de-travail
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  1. Bergstrom, Theodore & Blume, Lawrence & Varian, Hal, 1986. "On the private provision of public goods," Journal of Public Economics, Elsevier, vol. 29(1), pages 25-49, February.
  2. Rose-Ackerman, Susan, 1987. "Ideals versus Dollars: Donors, Charity Managers, and Government Grants," Journal of Political Economy, University of Chicago Press, vol. 95(4), pages 810-823, August.
  3. Sugden, Robert, 1982. "On the Economics of Philanthropy," Economic Journal, Royal Economic Society, vol. 92(366), pages 341-350, June.
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