Do non-profits make a difference?: evaluating non-profit vis-à-vis for-profit organisations in social services

This CPB Document provides a framework for the evaluation of non-profit organisations. This framework addresses the question under which conditions, and, if so, in what way non-profits should be stimulated. Essentially, in order to answer these questions, three steps can be followed: (i) identifying potentially relevant market failures that non-profits may aim to diminish; (ii) linking market failures to observed performance indicators for profits and nonprofits; and (iii) use these insights to derive policy implications: should non-profits be stimulated? We apply the proposed framework to three sectors that are commonly labelled as ‘social services’: the care sector, the childcare sector and welfare-to-work services. All these sectors are subject to substantial informational problems regarding the quality of services. When surveying the literature, we find non-profit organisations only to make a difference in some specific cases. So far, there is no strong evidence that can be used as an argument to stimulate non-profit organisations in mixed markets. Moreover, such (targeted) policies may discourage donated labour and private donations, thus rendering them largely ineffective.

Publication infos:
The Hague, CPB Netherlands Bureau for Economic Policy Analysis, 2006
Publication year:
Number of pages:
54 p. : ill.
CPB Document ; No 142
Record appears in:

 Record created 2017-03-20, last modified 2019-03-25

Download fulltext

Rate this document:

Rate this document:
(Not yet reviewed)