Do not-for-profits make a difference in social services? A survey study

This paper provides a survey of the empirical literature on the relative performance of not-for-profit (NFP) organisations for three specific sectors. In particular, we compare the quality and accessibility of services that are provided by hospitals, child care organisations and welfare-to-work (WTW) organisations. Various mechanisms may explain the comparative advantages and disadvantages of not-for-profit organisations, as well as the origins of NFPs. We link these explanations to the actual relative performance of NFPs and discuss the implications for the government in mixed markets, where both for-profit (FP) and NFP organisations are. Our general finding is that NFPs do not make a difference on performance outcomes vis-a-vis FP organisations. It seems that the degree of competition, as well as regulatory policies are more important determinants of market performance.