We present a general equilibrium model where manufacturing and service firms coexist. The quality of the service depends on the workers’ effort. Two institutional regimes are compared, in which the service-providing firms are for-profit enterprises or, alternatively, nonprofit organizations. The paper shows that the employment level, aggregate income and both the quantity and the quality of the service are higher when the service-providing firms are nonprofit organizations. Moreover, switching from one regime to the other has redistributive effects, and the equilibrium associated with the presence of nonprofit organizations is Pareto-superior if they enjoy a significant advantage at motivating their employees.

Profit versus non-profit firms in the service sector: an analysis of the employment and welfare implications

BONATTI, Luigi;
2005-01-01

Abstract

We present a general equilibrium model where manufacturing and service firms coexist. The quality of the service depends on the workers’ effort. Two institutional regimes are compared, in which the service-providing firms are for-profit enterprises or, alternatively, nonprofit organizations. The paper shows that the employment level, aggregate income and both the quantity and the quality of the service are higher when the service-providing firms are nonprofit organizations. Moreover, switching from one regime to the other has redistributive effects, and the equilibrium associated with the presence of nonprofit organizations is Pareto-superior if they enjoy a significant advantage at motivating their employees.
journal article - articolo
2005
Bonatti, Luigi; Borzaga, Carlo; Mittone, Luigi
File allegato/i alla scheda:
Non ci sono file allegati a questa scheda.
Pubblicazioni consigliate

Aisberg ©2008 Servizi bibliotecari, Università degli studi di Bergamo | Terms of use/Condizioni di utilizzo

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/10446/19775
Citazioni
  • Scopus ND
  • ???jsp.display-item.citation.isi??? ND
social impact