Organizational design for making a difference

Canice Prendergast

Journal of Public Economics, 2023, vol. 218, issue C

Abstract: We address organizations that rely on donors, when those donors are motivated by making a difference. We show that when donors care sufficiently about their marginal impact, firms use practices that would normally be deemed inefficient. These include prioritizing less valuable opportunities over better ones, investing most in their weakest initiatives, and benefiting from not identifying the quality of their projects. These all arise from a distinction between marginal and average returns generated by donor preferences.

Keywords: Donors; Making a difference; Donor driven organizations (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:pubeco:v:218:y:2023:i:c:s0047272722002195

DOI: 10.1016/j.jpubeco.2022.104817

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