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Retional Nonprofit Entrepreneurship

  • Bilodeau, M.
  • Slivinski, 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 University of Western Ontario, Department of Economics in its series UWO Department of Economics Working Papers with number 9709.

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Length: 33 pages
Date of creation: 1997
Date of revision:
Handle: RePEc:uwo:uwowop:9709
Contact details of provider: Postal: Department of Economics, Reference Centre, Social Science Centre, University of Western Ontario, London, Ontario, Canada N6A 5C2
Phone: 519-661-2111 Ext.85244
Web page:

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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 810-23, August.
  3. Sugden, Robert, 1982. "On the Economics of Philanthropy," Economic Journal, Royal Economic Society, vol. 92(366), pages 341-50, June.
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