Date of Award

1-12-2011

Document Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

Department

Sociology

First Advisor

Thomas Nowak, Ph.D.

Second Advisor

Alex Heckert, Ph.D.

Third Advisor

Willard W. Radell, Ph.D.

Abstract

Historically there has been great focus on the performance of nonprofits versus for-profit entities. The literature has included research on variances in salaries, operational efficiencies, pricing, market penetration, composition of clientele, etc. However, there is a new category of entity that exists between the traditional nonprofit and for-profit spectrum. This entity is the nonprofit engaged in social enterprise activities. Social enterprise is the pursuit of earned income activities. To date, little research has focused on how these particular entities may vary in their performance from traditional nonprofits or even for-profits. If research has found differences in nonprofits versus for-profits could there be differences between social enterprise organizations and their traditional counterparts? There are various items that could be explored such as variances in operational performance, outcomes, salaries, and others. However, this research examined the differences in financial performance between traditional nonprofit behavioral healthcare providers and those nonprofit behavioral healthcare providers engaged in social enterprise activities. This research uses financial data available from Guidestar and completed surveys from Pennsylvania behavioral healthcare organizations to determine differences in financial metrics. Linear regression was used to estimate the impact social enterprise had on current ratio, days cash on hand, net profit margin percentage, net days in accounts receivable, debt ratio, revenue per full time employee, and administrative overheard percentage. The results of the research did not typically support the hypotheses and the null was accepted that social enterprise did not lead to better financial performance in these various metrics. Further research must be conducted to continue to provide resolution to the ongoing debate of whether social enterprise provides benefits to the organization or harm.

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