Guide to Using Economic Principles in Nonprofit Decision Making

Effective Economic Decision-Making by Nonprofit Organizations
edited by Dennis R. Young

This collection of essays, written primarily by scholars, discusses how nonprofit organizations can apply common concepts from the for-profit world, including cost-benefit analysis and risk assessment, to their decision making.

Dennis R. Young, chief executive officer of the National Center on Nonprofit Enterprise, in Arlington, Va., says that business models can help nonprofit groups with limited resources increase their efficiency and effectiveness. At the same time, Mr. Young says those decision-making tools will often lead nonprofit groups, with their focus on serving society, to solutions that differ from those of businesses encountering similar situations.

The first portion of the book examines such operating questions as how an organization should set the price for its services and how to determine employee compensation. Another essay explores when nonprofit groups should hire companies to take care of fund-raising, payroll, public-relations, or other functions.

In a section on fund raising, the authors discuss how much money nonprofit groups should spend to raise money and how to calculate how much in donations each dollar devoted to fund raising yields.

Other subjects include investing endowment funds and taking part in commercial ventures, as well as how to best use the Internet for fund raising.

Publisher: Foundation Center, 79 Fifth Avenue, New York, N.Y. 10003-3076; (212) 807-3690 or (800) 424-9836; fax (212) 807-3691; http://fdncenter.org/marketplace; 228 pages; $34.95; I.S.B.N. 1-931923-69-8.