Heterogeneity and self-selection into nonprofit management

Stijn Van Puyvelde and Marc Jegers ()
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Marc Jegers: Vrije Universiteit Brussel, Department of Applied Economics, Brussels, Belgium

No 1603, CIRIEC Working Papers from CIRIEC - Université de Liège

Abstract: This paper presents a microeconomic model of self-selection into nonprofit management. First, we extend previous models by assuming that individuals are heterogeneous in multiple dimensions besides intrinsic motivation, including managerial ability, self-image concerns, and laziness at work. Second, we consider the public sector as an alternative to nonprofit sector employment, and assume that nonprofit, for-profit, and public sectors differ in the perceived level of red tape, and the potential levels of fixed pay and variable pay. We show that self-selection into nonprofit management is a complex process that depends on multiple factors, and formulate conditions that need to be fulfilled in order to have self-selection of heterogeneous individuals into nonprofit management. From this finding we derive a number of important avenues for future research.

Keywords: self-selection; managers; nonprofit; intrinsic motivation; wage differentials (search for similar items in EconPapers)
JEL-codes: J31 L31 (search for similar items in EconPapers)
Date: 2016-03
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Persistent link: https://EconPapers.repec.org/RePEc:crc:wpaper:1603

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