Management Practices: Are Not For Profits Different?
Recent studies have demonstrated the importance of good management for firm performance. Here, we focus on management in not-for-profits (NFPs). We present a model predicting that management quality will be lower in NFPs compared to for-profits (FPs), but that outputs may not be worse if managers are altruistic. Using a tried and tested survey of management practices, we find that NFPs score lower than FPs but also that, while the relationship between management scores and outputs holds for FPs, the same is not true for NFPs. One implication is that management practices that work for FPs may be less effective in driving performance in NFPs.
|Keywords||impure altruism, management, not-for-profits|
|JEL||Public Economics: Miscellaneous issues (jel H8), Human Capital; Skills; Occupational Choice; Labor Productivity (jel J24), Public Sector Labor Markets (jel J45), Comparison of Public and Private Enterprises; Privatization; Contracting Out (jel L33)|
|Series||Tinbergen Institute Discussion Paper Series|
Delfgaauw, J, Dur, A.J, Propper, C, & Smith, S. (2011). Management Practices: Are Not For Profits Different? (No. TI 2011-094/1). Tinbergen Institute Discussion Paper Series. Tinbergen Institute. Retrieved from http://hdl.handle.net/1765/25709