Performance Measurement in Not-for-Profit Governance: An Empirical Study of the Minnesota Independent School Districts

Banker, Rajiv D.; Chang, Hsihui; Feroz, Ehsan H.

Performance Measurement in Not-for-Profit Governance: An Empirical Study of the Minnesota Independent School Districts

Annals of Operation Research, January 22, 2011 (online)

25 Pages Posted: 15 Oct 2008 Last revised: 8 Jan 2019

See all articles by Rajiv D. Banker

Rajiv D. Banker

Temple University - Department of Accounting

University of Washington, Milgard School of Business-Accounting ; University of Illinois at Urbana-Champaign; Government of the United States of America - US GAO Advisory Council; University of Minnesota, Labovitz School of Business-Department of Accounting; University of Minnesota, Carlson School of Management-Department of Accounting; American Accounting Association

Date Written: June 1, 2008

Abstract

Linearity and separability assumptions are pervasive in most not-for-profit governance and performance measurement systems. In this paper, we employ both parametric and nonparametric econometric methodologies to test the linearity and separability assumptions using data collected from the Minnesota Independent School Districts. Our test results reject both the assumptions for the Minnesota independent school districts. These findings suggest a need to develop alternative procedures that do not rely on these two pervasive assumptions if the information provided by not-for-profit performance measurement systems is to be relevant for governance decision making and performance evaluation.

Keywords: Performance Measurement, Not- for-Profit Governance, Linearity, Input Separability, School District Financing, Political Economy

JEL Classification: C44, C61, C67, D61, G18, G30, H10, I22, L30, L31, L51,M40, M41, M49, P16

Suggested Citation: Suggested Citation

Banker, Rajiv D. and Chang, Hsihui and Feroz, Ehsan H., Performance Measurement in Not-for-Profit Governance: An Empirical Study of the Minnesota Independent School Districts (June 1, 2008). Annals of Operation Research, January 22, 2011 (online). Available at SSRN: https://ssrn.com/abstract=1284679