Workshop in Multidisciplinary Philanthropic Studies (WIMPS)
Tuesday, April 22, 2014
12:00 – 1:15 p.m.
Julia Carboni, PhD
Assistant Professor, School of Public and Environmental Affairs
Indiana University-Purdue University Indianapolis
“ORGANIZATIONAL FORM, STRUCTURAL EMBEDDEDNESS AND CONTRACT PERFORMANCE IN MIXED SECTOR MARKETS”
The U.S. has a long history of contracting out social service functions to nongovernmental organizations (see Cooper 2003; Milward and Provan 2000; Smith and Lipsky 1996). Though nonprofits are preferable social service providers for legal and normative reasons, government increasingly relies on for-profit organizations to deliver social services (Eggers and Ng 1993; Salamon 1993; U.S. GAO Report 1997, 2002). Though prior literature emphasizes organizational sector as an independent predictor of performance, organizational performance is more likely the result of multiple factors including sector and structural position in a market. Individual actors are embedded in a structural context that may constrain agency and rational behavior (Baum and Dutton 1996; Emerson 1972; Galaskiewicz and Bielefeld 1998; Granovetter 1985; Uzzi 1996). Where government contracts with multiple organizations to produce the same service, dyadic contract relationships are directly embedded in a larger system of contracts where agency may be influenced by the structural position. I use qualitative comparative analysis (QCA) to understand how sector combines with structural factors to lead to acceptable contract performance in juvenile justice programs. QCA is a discovery oriented research tool that analyzes whether combinations of variables within cases produce a specific outcome and whether those combinations are consistent across cases. I find that sector is not a necessary or sufficient predictor of performance on its own. Rather it combines with structural factors such as market competition, prevalence of nonprofits in a market, and public program presence to lead to acceptable contract performance. Combinations vary by sector. This paper is relevant and timely for nonprofit management as it takes a nuanced look at the role of sector on performance in markets where nonprofits and for-profits compete.
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