The End is Nigh: Limits to Growth of the Nonprofit Sector

ARNOVA Annual Conference November, 2013 Hartford, CT

26 Pages Posted: 10 Aug 2014

See all articles by Jesse D. Lecy

Jesse D. Lecy

Arizona State University (ASU) - School of Public Affairs; Maxwell School of Syracuse University; Georgia State University - Andrew Young School of Policy Studies

Eric Van Holm

Georgia Institute of Technology

Date Written: November 19, 2013

Abstract

The nonprofit sector has experienced exponential growth over the past three decades with nearly 50,000 new nonprofits created last year. Past examples of industry growth suggest that this rate of growth is not sustainable. Empirical population ecology studies of nascent industries show a period of rapid growth followed by market saturation, then consolidation of organizations and market share resulting in increased competition for small and new organizations. We use historical nonprofit data from the NCCS and apply ecological models to show that the nonprofit sector may be fast approaching growth limits. Market saturation varies by metropolitan area and nonprofit subsector.

Keywords: nonprofit sector, industry life-cycle

JEL Classification: L30

Suggested Citation

Lecy, Jesse D. and Van Holm, Eric, The End is Nigh: Limits to Growth of the Nonprofit Sector (November 19, 2013). ARNOVA Annual Conference November, 2013 Hartford, CT. Available at SSRN: https://ssrn.com/abstract=2478238 or http://dx.doi.org/10.2139/ssrn.2478238

Jesse D. Lecy (Contact Author)

Arizona State University (ASU) - School of Public Affairs ( email )

Farmer Building 440G PO Box 872011
Tempe, AZ
United States

Maxwell School of Syracuse University ( email )

400 Eggers Hall
Syracuse, NY 13244
United States

Georgia State University - Andrew Young School of Policy Studies ( email )

Public Management and Policy
35 Broad Street, 6th Floor
Atlanta, GA 30303-3083
United States

Eric Van Holm

Georgia Institute of Technology ( email )

Atlanta, GA 30332
United States

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