Nonprofit mergers–too much to hope for?


From “A giving recession?” (Economist, 1/6):

Mr Brest suggested that the downturn might provide an opportunity to rationalise the non-profit sector. There are now around 1.6m non-profits in America, employing one in every 11 workers, which he deemed excessive. Many of these non-profits duplicate each other, under-perform and miss out on economies of scale because they are too small. Tough times could encourage them to collaborate more, sharing back-office functions and maybe even merge. Yet, when pushed, neither foundation boss seemed confident that this outbreak of efficiency would happen, and especially not through mergers. The inertia in the non-profit sector is too strong, they suggested—though surely the large amount of money they give away makes them well-placed to put pressure on the non-profits they fund to collaborate or merge.