Kiel Working Papers, Kiel Institute for World Economics
No 1717:
US based NGOs in International Development Cooperation: Survival of the Fittest?
Peter Nunnenkamp, Hannes Öhler and Tillmann Schwörer
Abstract: The non-distribution constraint of non-governmental
organizations (NGOs) would be harder, and financiers as well as recipients
could expect more charitable output from them, if less efficient NGOs were
squeezed out of international development cooperation. We employ Probit and
complementary log-log estimations to analyze which factors determine the
probability of “market” exit for almost 900 US based NGOs with overseas aid
activities during the 1984-2003 period. Apart from their size and
experience, we consider administrative overheads as an important aspect of
NGO efficiency. We also account for other dimensions of NGO heterogeneity,
including the importance of official refinancing. We find that larger
administrative overheads increase the probability of exit for secular NGOs,
though not for religious NGOs. Furthermore, we detect complex non-linear
effects once the interactions between administrative overheads and official
refinancing are taken into account
Keywords: non-governmental organizations, foreign aid, NGO characteristics, market exit, Probit models, complementary log-log; (follow links to similar papers)
JEL-Codes: L31,; F35; (follow links to similar papers)
29 pages, July 2011
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