Publicity vs. impact in nonprofit disclosures and donor preferences: a sequential game with one nonprofit organization and N donors
- 792 Downloads
Charitable giving is one of the essential tasks of a properly functioning civil society. This task is greatly complicated by the lack of organizational transparency and by the information asymmetries that often exist between organizations and donors in the market for charitable donations. The disclosure of financial, performance, donor-relations, and fundraising-related data is thus an important tool for nonprofit organizations attempting to attract greater donations while boosting accountability and public trust. There are, however, varying payoffs associated with such disclosure depending on the nature of donor preferences and the relative openness and effectiveness of competing organizations. To help understand the interplay between nonprofit organizational disclosures and individual donations, we present a novel game-theoretic model of disclosure–donation interactions that incorporates the predominant forms of both donor preferences and “value-relevant” information.
KeywordsVoluntary disclosure Nonprofit organizations Donations Charitable giving Game theory Organizational communication Strategic communication
Unable to display preview. Download preview PDF.
- American Red Cross (February 12, 2010) January 2010 Haiti earthquake: one-month progress report for the American Red Cross response. American Red Cross. Google Scholar
- Barth, M. E., Beaver, W. H., & Landsman, W. R. (2001). The relevance of the value relevance literature for financial accounting standard setting: another view. SSRN eLibrary. doi: 10.2139/ssrn.246861.
- Behn, R. D. (2005). The accountability dilemma. Public Management Report, 2(7), 1–2. Google Scholar
- Blackwood, A., Wing, K., & Pollak, T. H. (2008) The nonprofit sector in brief: facts and figures from the nonprofit almanac 2008: public charities, giving, and volunteering. http://www.urban.org/publications/411664.html, Urban Institute.
- Brinkerhoff, D. W. (2001). Taking account of accountability: a conceptual overview and strategic options. US Agency for International Development, Center for Democracy and Governance, Implementing Policy Change Project, Phase 2. Google Scholar
- Brody, E. (2002). Accountability and public trust. In L. M. Salamon (Ed.), The state of nonprofit America. Brookings Institute, Washington, DC. Google Scholar
- Bryce, H. (1992). Financial and strategic management for nonprofit organizations. Englewood Cliffs: Prentice Hall. Google Scholar
- Bryson, J. (1995). Strategic planning for public and nonprofit organizations. San Francisco: Jossey-Bass. Google Scholar
- Dighe, N. S., Zhuang, J., & Bier, V. M. (2009). Secrecy in defensive allocations as a strategy for achieving more cost-effective attacker deterrence. International Journal of Performability Engineering, 5(1), 31–43. Google Scholar
- Greenlee, J. S., & Brown, K. (1999). The impact of accounting indicators on contributions to charitable organizations. Research in Accounting Regulation, 13, 111–125. Google Scholar
- Jensen, M. (1998). Foundations of organizational strategy. Cambridge: Harvard University Press. Google Scholar
- Khumawala, S. B., Neely, D. G., & Gordon, T. P. (2009). The impact of voluntary disclosures on charitable giving, working Paper. Google Scholar
- Malani, A., & Laxminarayan, R. (2009). Incentives for surveillance of infectious disease outbreaks. SSRN eLibrary. Google Scholar
- Parsons, L. M. (2003). Is accounting information from nonprofit organizations useful to donors? A review of charitable giving and value relevance. Journal of Accounting Literature, 22, 104–129. Google Scholar
- Pew Research Center (2010). Haiti dominates public’s consciousness: nearly half have donated or plan to give (January 20, 2010). The Pew Research Center for the People and the Press. Google Scholar
- Porter, M. E. (1980). Competitive strategy. New York: Free Press. Google Scholar
- ReliefWeb (2010). Funding status of latest appeals. http://ocha.unog.ch/fts/.
- Saxton, G. D., Neely, D. J., & Guo, C. (2009). Web disclosure and the market for charitable contributions. Paper presented at the annual meeting of the American Accounting Association, New York, NY, 1–5 August 2009. Google Scholar
- Saxton, G. D., Kuo, J. S., & Ho, Y. C. (2011). The determinants of voluntary financial disclosure by nonprofit organizations. Nonprofit and Voluntary Sector Quarterly (accepted). Google Scholar
- Tinkelman, D. (1999). Factors affecting the relation between donations to not-for-profit organizations and an efficiency ratio. Research in Government and Nonprofit Accounting, 10, 135–161. Google Scholar
- Yetman, R., & Yetman, M. (2003). The effect of nonprofits’ taxable activities on the supply of private donations. National Tax Journal, 56(1), 243–258. Google Scholar