Lee, Cheon. Three essays on the complex relationship between nonprofit commercialization and charitable giving. Retrieved from https://doi.org/doi:10.7282/t3-rvaj-cz15
DescriptionNonprofit scholars and practitioners have been concerned about nonprofit commercialization, increased reliance on commercial revenue, and its negative consequences. Among various topics related to nonprofit commercialization, the crowding-out effect of commercialization on charitable giving has received considerable scholarly attention. Although the literature leans towards showing crowding-out effects, such findings cannot fully explain the diffusion and prevalence of commercial practices in the nonprofit sector. This dissertation comprises three essays that explore the complex relationship between nonprofit commercialization and charitable giving. The first essay examines the relationship between nonprofit commercialization and charitable giving with the Cultural Data Project data on arts and culture nonprofit organizations. Contrary to previous studies focusing on linear relationships, this essay reveals an inverted U-shaped relationship between commercial revenue and charitable contributions and shows that commercial revenue crowds in charitable contributions up to a certain threshold and then starts to crowd them out. The second essay explores how individuals respond to nonprofit commercialization and whether it is possible to make nonprofit commercialization more acceptable to donors and stakeholders. Based on thematic and episodic message framing theory, a two-by-two factorial survey experiment finds that both thematic and episodic framing increase acceptance of a nonprofit’s decision to commercialize and increase participants’ willingness to donate and volunteer. The third essay shares the findings of a survey experiment asking individuals about charitable contributions that will be directly used to initiate new commercial revenue models. In the scenario that connects charitable giving and commercial revenue, loss framing was more effective than gain framing in increasing perceived organizational effectiveness regarding nonprofit commercialization, but positively framing nonprofit commercialization as social entrepreneurship was not effective in influencing individuals’ perceptions of nonprofit commercialization or willingness to donate. The findings reveal the complex relationship between nonprofit commercialization and charitable giving and show that the crowding-out effect can be prevented or mitigated by effectively communicating with donors and stakeholders.