Abstract
Efficiency comparisons of nonprofit and for-profit day care centers reveal that, in 1977, production functions of nonprofit and for-profit day care centers were similar. Cost levels were also similar for centers providing identical services. However, on average, nonprofit centers offered costlier services than for-profit centers. In the segment of the industry not subject to federal regulations, nonprofit centers offered services with higher social externalities than for-profit centers. In the federally regulated segment, nonprofit centers offered higher quality services than for-profit centers. Therefore the important difference in economic outcomes of nonprofit and for-profit day care centers involved product selection rather than efficiency levels.
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© 1993 Springer Science+Business Media New York
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Preston, A.E. (1993). Efficiency, Quality, and Social Externalities in the Provision of Day Care: Comparisons of Nonprofit and For-Profit Firms. In: Griliches, Z., Mairesse, J. (eds) Productivity Issues in Services at the Micro Level. Springer, Dordrecht. https://doi.org/10.1007/978-94-011-2200-9_11
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DOI: https://doi.org/10.1007/978-94-011-2200-9_11
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