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A model of nongovernmental organization regulation with an application to Uganda

Burger, Ronelle; Dasgupta, Indraneel; Owens, Trudy

Authors

Ronelle Burger

Indraneel Dasgupta



Abstract

We develop a model of regulation of service-delivery nongovernmental organizations (NGOs), where future grants are conditional on prior spending of some minimal proportion of current revenue on direct project-related expenses. Such regulation induces some NGOs to increase current project spending but imposes wasteful costs of compliance verification on all NGOs. Under a large class of parametric configurations, we find that regulation increases total discounted project expenditure over a regime of no regulation, when verification costs constitute no more than 15% of initial revenue. We characterize the optimal regulatory policy under these configurations. We apply our analysis to a large sample of NGOs from Uganda and find regulation to be beneficial in that context.

Journal Article Type Article
Publication Date Oct 1, 2015
Journal Economic Development and Cultural Change
Print ISSN 0013-0079
Electronic ISSN 1539-2988
Publisher University of Chicago Press
Peer Reviewed Peer Reviewed
Volume 64
Issue 1
APA6 Citation Burger, R., Dasgupta, I., & Owens, T. (2015). A model of nongovernmental organization regulation with an application to Uganda. Economic Development and Cultural Change, 64(1), https://doi.org/10.1086/682885
DOI https://doi.org/10.1086/682885
Publisher URL http://www.journals.uchicago.edu/doi/10.1086/682885
Copyright Statement Copyright information regarding this work can be found at the following address: http://eprints.nottingh.../end_user_agreement.pdf

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Copyright Statement
Copyright information regarding this work can be found at the following address: http://eprints.nottingham.ac.uk/end_user_agreement.pdf





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