The puzzle of organization dimensions; a tri–sectoral perspective

References

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• For example, three of the leading theories of the nonprofit sector is premised upon a failure or a gap in the performance or methods of the public or private sectors to explain the existence and function of a third sector. For example, Burton Weisbrod has argued that governments leave a residual of unsatisfied demand for public goods because it strives to satisfy only the demand level of the median voter. Nonprofits therefore arise to provide public goods supplemental to those provided by government to individuals who demand more than the median. Conversely, the “free rider” problem of providing collective goods through the market can lead to “market failure”. When combined, such government and market failure theories point to a demand for a range of collective goods that are desired by a part of the community which is less than a political majority and smaller than a profitable market. Thus nonprofit organizations function to fill the gaps left from market and government failures
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• Ibid.
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