Non-profit-funding environment relations: theory and application

Abstract

The relationships between funding heterogeneity and organisational structure and functioning were examined for a panel of non-profit organisations. Resource dependence and institutional theory were used to derive hypotheses predicting positive associations between funding heterogeneity and non-profit boundary spanning, modelling and participation in collective efforts. For non-profits which were less vulnerable to institutional aspects of their environments, funding heterogeneity was found to have a positive effect on boundary spanning, consistent with resource dependence theory. For non-profits which were more vulnerable to institutional factors, on the other hand, funding heterogeneity was found to have positive effects on modelling and participation in collective efforts; consistent with institutional theory. These results argue that resource dependence and institutional theory need to be combined for the analysis of organisation-environment relations and suggest how this could be accomplished.