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Full-Text Articles in Social and Behavioral Sciences
The Investment Returns Of Nonprofit Organizations, Part Ii, Garth Heutel, Richard Zeckhauser
The Investment Returns Of Nonprofit Organizations, Part Ii, Garth Heutel, Richard Zeckhauser
ECON Publications
We continue our examination of the investment performance of nonprofit charities and foundations. This analysis tests hypotheses about what types of organizations do better. Our motivating intuition is that nonprofits with greater focus on investment performance will secure higher returns. Our hypotheses are tested by regressing the rate of return for each organization on various characteristics. As expected, nonprofits whose primary business is predominantly financial, such as insurance providers and pension or retirement funds, consistently earn higher returns. The data also support our hypotheses that larger nonprofits, older nonprofits, and private foundations will tend to outperform. The evidence is mixed …
The Investment Returns Of Nonprofit Organizations, Part I, Garth Heutel, Richard Zeckhauser
The Investment Returns Of Nonprofit Organizations, Part I, Garth Heutel, Richard Zeckhauser
ECON Publications
Nonprofit charities and foundations hold endowments and other investments. How do their investments perform? Some high-profile nonprofit endowments, importantly those of colleges and universities, have been studied before. This study is the first, to our knowledge, that looks at a large number of the diverse types of nonprofits. We investigate the determinants of investment performance using a large panel data set culled from the 990 forms nonprofits must file annually with the IRS. In this first part, we discuss our approach and the challenges of using these data to infer investment returns. The IRS data, though less than perfect, yield …