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Nonprofit providers on regional social service qausi-market

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Abstract

Nonprofits play a growing role in social service delivery as a result of privatization of local public services through contracting out by the public sector. This paper explores a competitive bidding process in eight regions of the Russian Federation which local governments entered into during 2011-2012. The author reviews reasons to involve nonprofit organizations in a quasi-market as local government social service contractors. The nondistribution constraints and mission of nonprofits organizations tend to preclude exploitation of purchasers and consumers. Thus, this type of social services providers can be more appropriate for needs of the society. Then bidding documents have been analyzed in terms of a type of providers ownership, public or private one, levels of nonprofits activity and competitiveness. The findings indicate considerable discrepancies between numbers of social services competitive tenders in the regions in question. Types of social services that the local governments procure vary significantly from region to region. They range from strictly standardized services to credence ones. These differences are supposed to be an essential factor of nonprofits participation in procurement because of the characteristics of nonprofit organizations. The most active nonprofits involvement has been found out in the regions where procured services are the same the nonprofits usually produce. Three types of nonprofitsbehavior at the regional quasi-markets have been discovered. Firstly, they take an active part in the competitive bidding and compete with business and public organizations successfully. Secondly, they actively participate in this process but only compete with similar producers. Finally, they are rather inactive as potential local government contractors.

Suggested Citation

  • Svetlana Suslova, 2014. "Nonprofit providers on regional social service qausi-market," Public administration issues, Higher School of Economics, issue 3, pages 72-89.
    • Handle: RePEc:nos:vgmu00:2014:i:3:p:72-89
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    1. Le Grand, Julian, 1991. "Quasi-markets and Social Policy," Economic Journal, Royal Economic Society, vol. 101(408), pages 1256-1267, September.
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