Abstract
Research on differences between public, for-profit, and nonprofit providers of welfare services has provided mixed findings, depending on welfare state arrangement, regulation, and service area. This paper’s objective is to study the differences between public, nonprofit (cooperatives and other nonprofits), and for-profit welfare providers from the perspective of the users in the tightly regulated Scandinavian context. We ask how the users perceive the providers from different sectors differently and how this variation can be explained. The study relies on a large-scale survey carried out in 2015 in the city of Oslo, Norway. From the survey, we identify the two main results. First, despite limited differences, users of nonprofit kindergartens are generally more satisfied than users of for-profit and public kindergartens. Second, an important explanation for variations in user satisfaction among kindergartens is identified in a pocket of regulatory leniency: the quality of food service. This is the only expense that varies among kindergartens in Norway. These results indicate that more lenient regulations could potentially increase provider distinctiveness. Based on the existing literature, we discuss why nonprofit providers seem to fare better in the minds of users than public and for-profit providers.
Highlights
Does it matter to users whether public, for-profit, or nonprofit providers deliver publicly funded welfare services? This is a core question in nonprofit scholarship, underpinning much of the motivation behind studies of the nonprofit providers
A key insight from this study is that most users of kindergartens in Oslo are satisfied with the services they receive, confirming earlier studies of user satisfaction with welfare services in Scandinavia generally (Van Deth et al 2007) and in Norwegian kindergartens (Linden et al 2017; Christensen and Linden 2017)
We see differences between institutional sectors: Across various measures, user satisfaction is somewhat higher among parents with children in parent cooperatives and other nonprofit kindergartens than parents with children in for-profit and public kindergartens
Summary
Does it matter to users whether public, for-profit, or nonprofit providers deliver publicly funded welfare services? This is a core question in nonprofit scholarship, underpinning much of the motivation behind studies of the nonprofit providers. This paper’s objective is to study differences in user satisfaction between public, nonprofit, and for-profit welfare providers in the Scandinavian welfare context, which is characterized by a strong demand for equality obtained through public financing and regulation. The study contributes to a growing literature on recent developments in the Scandinavian welfare mix, characterized by a growth in for-profit providers of welfare, which are more or less fully financed by public (tax) money. This literature largely ignores the nonprofits as an independent sector (Petersen and Hjelmar 2014). The surveys have never been used in academic research, and the present study demonstrates the usefulness and limitations of user surveys as a tool to understand differences in the welfare mix—the division of public, forprofit, and nonprofit providers
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