Abstract
Sustainability of nonprofit organizations is a key concern for today’s nonprofit scholars and practitioners. Building upon the nonprofit economics literature, the present paper introduces the distinction between the demand-side and supply-side determinants of nonprofit sustainability and makes the case for the discrepancy between them. This discrepancy presents not only a generic conceptual explanation of the nonprofit sustainability problems but is also applicable to the context of the European rural nonprofit sector. Three arguments are advanced. First, the notorious implementation problems of LEADER partnerships can be explained as a manifestation of the above discrepancy. Second, and related, the rural context implies the tendency of the supply-side determinants of nonprofit sustainability to undermine the demand-side ones. Third, recent empirical findings from the Czech Republic show that this tendency does not necessarily imply the possibility of a clear classification of the demand-side and supply-side sustainability determinants. Rather, those features of rural areas and communities that significantly affect the size of the local nonprofit sector exhibit a controversial entanglement of demand-side and supply-side identities.
Highlights
Sustainability of nonprofit organizations is an increasingly prominent theme in today’s booming multidisciplinary field of nonprofit sector studies
The conceptual innovation of the present paper is in reconstructing the distinction between the demand-side and supply-side explanations of the nonprofit sector as the divergence between the demand-side and supply-side determinants of nonprofit sustainability
This reconstruction informs the nonprofit sustainability literature in three respects that are especially relevant to the European rural development context
Summary
Sustainability of nonprofit organizations is an increasingly prominent theme in today’s booming multidisciplinary field of nonprofit sector studies. Many individual nonprofit organizations operate in a complex and turbulent environment that poses a significant challenge to their own economic sustainability (cf [5,6,7]) It is primarily the economic sustainability of individual nonprofit organizations that today’s nonprofit scholars have in mind when referring to “nonprofit sustainability” (cf [8,9]). These organizational transformations in the nonprofit sector are analyzed through the lenses of sociological institutionalism (e.g., [15]), organizational ecology (e.g., [16]), resource dependence (e.g., [17]) and social systems theory (e.g., [18]) All these analyses yield the disconcerting implication that the precarious sustainability of nonprofit organizations potentially undermines the useful functions that are ascribed to nonprofit organizations by theoretical models. This implication poses the novel research question of enriching the theoretical understanding of nonprofit functions with an account of nonprofit sustainability problems in such a way as to arrive at a more balanced assessment of the actual impact of the nonprofit sector
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