Unrestricted Cash Windfalls and Nonprofit Operating Outcomes

• In Event: 2.01 Nonprofit Research Concurrent Session: NPO Performance

Abstract

This study examines the outcomes associated with an unrestricted cash windfall for nonprofit organizations (NPOs). Using e-filed Form 990 data, I construct a novel measure to operationalize an unrestricted cash windfall. I employ the Mahalanobis matching procedure to produce a sample of windfall and control organizations and I use a dynamic difference-in-differences approach to test several hypotheses related to nonprofit operating outcomes. I find that a cash windfall has a positive effect on program spending but no effect on CEO compensation or fixed assets. In additional exploratory analysis, I find that the windfall has a positive effect on management expense. The results of this study leave several avenues open for further investigation.

Author

• Kiely Yonce, Washington State University