Do Nonprofits Engage in Excessive Fundraising?

Philip Gayle ()

MPRA Paper from University Library of Munich, Germany

Abstract: This study examines whether nonprofits (NP) engage in ‘excessive’ fundraising (EF) relative to what may be socially optimal. The investigation requires using a structural empirical model to approximate socially optimal fundraising levels. The analysis reveals evidence of EF of up to 31% in a year and identifies the “donor-stealing” attribute of fundraising across rival NPs as a key driver of EF. I show that if rival NPs cooperatively set fundraising levels, then this practice effectively eliminates EF since each NP internalizes the “donor-stealing” effect. The findings support united fund drives like those we see mobilized by the United Way.

Keywords: Nonprofit Organizations; Excessive Fundraising (search for similar items in EconPapers)
JEL-codes: L13 L22 L30 (search for similar items in EconPapers)
Date: 2024-04-05
New Economics Papers: this item is included in nep-ind
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:120684

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