The Logic of the Nonprofit Sector : An Organisational Economics Perspective

The need to identify the distinctive logic of the nonprofit sector, recently pronounced in the literature, gives rise to the need to substantiate links between the logics of different societal sectors. This paper seeks to identify links between the logics of for-profit and nonprofit sectors from an organisational economics perspective. For this purpose, the paper reviews the conventional organisational economics view of the market/hierarchy continuum, and develops its alternative view accommodating markets, hierarchies, and nonprofit organisation. The underlying criterion of the alternative view of the continuum, and hence the link between the logics of nonprofit and for-profit sectors, is represented by the extent of commonness of interests of the interacting parties