Journal of Entrepreneurship and Public Policy

Journal of Entrepreneurship and Public Policy Emerald Article: Social enterprise as a means to reduce public sector deficits J. Howard Kucher

Article information: To cite this document: J. Howard Kucher, (2012),"Social enterprise as a means to reduce public sector deficits", Journal of Entrepreneurship and Public Policy, Vol. 1 Iss: 2 pp. 147 - 158 Permanent link to this document: http://dx.doi.org/10.1108/20452101211261426 Downloaded on: 09-10-2012 References: This document contains references to 63 other documents To copy this document: [email protected]

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Social enterprise as a means to reduce public sector deficits

Social enterprise

J. Howard Kucher College of Public Affairs, University of Baltimore, Baltimore, Maryland, USA

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Abstract Purpose – Charitable organizations have long been held out as separate from other human endeavors. One of the ways that this distinction has been maintained is through the use of a tax exemption. However, difficult economic times have caused state and local governments to search for additional revenues to make up for budget deficits. At the same time, there has been significant growth in the use of a new model for funding social missions as a social enterprise. While charity gets its operating income from grants and donations, this model uses commercial business activities as the funding for a social benefit, the purpose of this paper is to explore this model. Design/methodology/approach – This paper will provide a detailed review of the various reasons behind the tax exemption that nonprofits currently enjoy. It will then review alternatives that are available to government entities to address the desire to obtain additional revenue. Finally, it will examine the notion that a social enterprise may be a way to more equitably resolve these tensions and allow the delivery of desired social services to continue while helping to balance public budgets through both increases in tax revenue and reductions in government spending. In particular, it will examine a new legal structure that some social enterprises are employing. Findings – This paper will suggest that the L3C may be a way to not only further advance the ability of this social enterprise as a means to fund social missions, but may also serve as a way to reconcile the tension between society’s desire to care for the less fortunate and relieve some of the pressure to reduce spending that federal, state and local governments are currently experiencing. Originality/value – Reducing or eliminating these tax breaks without a thoughtful plan for transition would also pose significant risk to the many fine social benefit programs currently being delivered by the traditional non-profit sector. Nevertheless, the alternative offered by the L3C or some other new structure may allow for a reasonable compromise that eases the strain on public budgets without destroying the social support system that the non-profit community provides. Keywords Financial innovations, Fiscal policy, Government spending, Regulatory policy, Organizational structure, Local policy, Types of organization, Charity Paper type Research paper

Introduction The economic recession of the past few years has caused a significant strain on the operating budgets of local and state governments. This strain has caused many government officials to search for new and previously untapped sources of revenue to help close budget deficits. All across the country, state and municipal governments are examining a broad array of potential reductions or eliminations of various tax exemptions currently enjoyed by nonprofits (Cohen, 2010). Background In a capitalist economy, private enterprise is the means by which wealth is created (Baumol, 2002; Smith, 1796). Although there is significant debate on the definitions and concepts of wealth (Pirages, 1996), for purposes of this document the term will be used in the classical economic sense of the combined output of the land and labor of a society measured in monetary terms (Baumol, 2002; Smith, 1796). Having produced this wealth, a democratic society then constructs a social contract wherein the holders of the wealth agree to transfer portions of the wealth to a governmental entity in the

Journal of Entrepreneurship and Public Policy Vol. 1 No. 2, 2012 pp. 147-158 r Emerald Group Publishing Limited 2045-2101 DOI 10.1108/20452101211261426

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form of taxes and fees (Holcombe, 1985). Historically, theses taxes and fees have been used to fund matters that are deemed to be in the public interest. The justifications as to what makes something a matter to be publicly funded span a wide range of theories and perspectives. On one extreme are the conservative viewpoints that government should only fund the basics of defense, the administration of justice and selected public infrastructure. On the other end of the spectrum are the liberal perspectives that government should take a more active role in society by funding matters that can create new initiatives, change patterns in society or behavior or balance a perceived inequality (Eckstein, 1964). This debate is reflected in a basic tension within economic theory. On one side of this debate is the liberal economic perspective that holds that a just society exists when there is equality of opportunity. This view also holds that the ultimate output of an economic system is effectively unlimited, and that the success of one actor in the system does not necessarily need to come at the expense of another. On the other end of this debate is a socialist perspective that believes equality is achieved in output and distribution, that economic output is fundamentally limited, and that the advancement of one comes at the expense of another (Holcombe, 1985). The central notion in this debate is what goals or desires must be sacrificed in order to achieve the desired end. Within the American context, this debate manifests itself in the conflict between an efficient economic process and an equitable society. The social fabric of the USA has tended to seek dual goals of equal opportunity and a just society. These goals would seem to be in direct conflict with each other when viewed through the traditional economic theories. In order to achieve equality, there are sacrifices that need to be made in the efficiency of a market economy, and vice-versa. This tradeoff is particularly evident when the subject is social or political rights that are distributed to the public as a whole. Seeking to achieve a balance between the two goals then forces a constant juggling act that examines each public policy in terms of both its ability to help make the economy function better and the impact that it might have across disparate social and economic classes (Okun, 1975). One attempt to resolve this tension is the use of a charitable organization. Taxation and nonprofits The search for a root cause of the lack of social standing for a particular individual seems most often to come down to one of the two sources, the individual or society. In the former, there is an implication that for reasons of weakness or inability, certain individuals or classes of people simply “need a hand.” In the latter, the system is considered to be so flawed that it is literally impossible to change one’s lot in life without some sort of external intervention Historically, efforts to close the gaps in social equity that are created by either of these causes has been the role of charity (Egger and Yoon, 2004). For most of the history of civilized society, this desire to improve social equity has been the role of the church; and for just as long, these charitable activities have also historically been held out as separate from the commercial activities of everyday life. Further, they have been typically viewed as distinct in their economic status, specifically in that they are exempt from taxation in various forms. This tradition of tax exemption seems to be as old as the charitable activity itself, with direct references appearing in the civic codes of most ancient civilizations, as well as the vast majority of modern western societies (Colombo and Hall, 1995). It seems easy to understand that when one’s time is spent in pursuits primarily related to staying alive on a daily basis,

and in a context when the average lifespan of humankind in even the most civilized cultures was less than 40 years (Clark, 2007), even the most cerebral citizens of that day would not have the breadth of experience to develop extensive thought on such matters as social justice. There are certainly a number of theories as to the dates, times and reasons for the appearance of other methods for shaping society. One major turning point may have been thirteenth century Europe, when the city began to re-emerge as an economic and social nexus. The development of the trade guild, the resurgence of trade between nations and continents, the transition from the monastery to the university as the center of intellectual power and the growth of the bourgeois brought about a number of new thoughts on social order (Drucker, 1993). The reason for this and its relevance to the larger subject at hand is quite simple. Without the proximity of one person to another and the interaction and dialogue that occurs in such communities, social organization is impossible (Spencer, 1896). As the British settled into what would become the USA, the English legal tradition of charitable tax emption crossed the Atlantic along with them. As the structure of the new American society and legal system began to develop, the notion of a distinct legal status for certain ventures that served public purposes began to expand, albeit fitfully and not without extensive debate and challenge. Nonetheless, by the mid-nineteenth century, the distinct legal status of charitable organizations was firmly established at the federal level (Hall, 1987). However, the full implications of this distinction on the revenues of the federal and local governments were yet to be established. It would take the passage of the first federal income tax laws in 1894 (Colombo and Hall, 1995) to fully understand what this distinct status would mean. With the rise of the industrial revolution came the creation of the great family wealth of the Rockefellers, Carnegies and Vanderbilts. Along with this great wealth came an idea that charity could be done better (Drucker, 1993). Rather than focus on caring for the individual in a one-to-one relationship, it was thought that society as a whole could be affected for the common good, and the idea of philanthropy began to take shape (Egger and Yoon, 2004). And as these great philanthropic foundations were built, the notion of qualified tax exemptions was carried forward with them (Colombo and Hall, 1995). In current practice, the charitable organization in the USA is protected from various tax implications by virtue of Section 501(c) 3 of the Internal Revenue code, which provides an exemption from federal income tax for entities that are organized to support certain purposes (Colombo and Hall, 1995). It is also important to note that this relief from the tax burden is not done for altruistic purposes. In fact, there is a direct exchange expected from the nonprofit enterprise, namely that they are prohibited from distributing the profits of the venture to the investors and owners (Hansmann, 1981). Quoting from the tax code: The exempt purposes set forth in section 501(c)(3) are charitable, religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, and preventing cruelty to children or animals. The term charitable is used in its generally accepted legal sense and includes relief of the poor, the distressed, or the underprivileged; advancement of religion; advancement of education or science; erecting or maintaining public buildings, monuments, or works; lessening the burdens of government; lessening neighborhood tensions; eliminating prejudice and discrimination; defending human and civil rights secured by law; and combating community deterioration and juvenile delinquency (Internal Revenue Service (IRS), 2009).

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This federal exemption is carried through to the state level, with the majority of states maintaining parallel statues that support and mimic the provisions of the IRS code and its accompanying restriction on distribution of profits (Colombo and Hall, 1995). Public policy justification for nonprofit tax exemption To gain further perspective, it is necessary to briefly review the major points of support for a tax exemption for charitable ventures. One of the main theoretical constructs for the existence of a charity and its accompanying tax-exempt status is as a response to failures in the commercial market. Simply put, this theory proposes that there are certain services which nonprofit firms can perform better than for profit firms. Situations where productive output is difficult to measure directly; where the purchaser and recipient of the service are separate and unrelated or where the cost of the delivery of the service is higher than the individual purchaser is willing to bear have historically given rise to nonprofit ventures. The relief from tax burdens then becomes an economic incentive to undertake a venture that might otherwise be undesirable (Hansmann, 1986). Embedded within this market failure view is the notion of a public or common good. This concept holds that the market cannot be a valid method for providing a service that is not easily held in individual ownership, or that provides a service where there is not a direct link between the one who purchases the service and the one who receives it (Rose-Ackerman, 1986). This version of the market failure theory is also discussed under the notion of contract failure, and proposes that the standard method of making a business agreement (namely a contract) is not effective when the purchaser and the recipient are not linked to each other. In such a case, a nonprofit becomes a proxy for either or both parties and serves an intermediary function (Salamon, 1995). Another theory for supporting such a policy is the Government Failure theory, which posits that there are a number of services which society desires that the federal, state and local governmental system cannot or chooses not to address. In response to this perceived or actual lack of service, private citizens develop and support organizations, funded by donations, to provide the desired service. This theory is particularly applicable to subsets of the population that are marginalized due to economic or geographic reasons (Weisbrod, 1986), and can also be stated as the notion that nonprofits supplement governmental activities (Young, 2006). A branch of this theoretical perspective takes the view that nonprofits are a complement to government service in what amounts to a contractor/vendor relationship wherein the governmental entity is the funder while the nonprofit delivers the service (Salamon, 1987). In essence, the governmental failure in this theory lies in the acknowledgment that governmental entities lack the expertise required to effectively manage and deliver social services to the population that is in need (Young, 2006). In either of these two cases, the rationale for the tax exemption is that the nonprofit is providing a service that is desirable from a public policy perspective that the government is either unwilling or unable to provide. By granting tax relief, an economic incentive is provided for a private enterprise to provide the service (Hansmann, 1981). A third view has to do with the manner in which nonprofits derive much of their funding. Within this perspective, the notion of altruism brings up a debate over the motives underlying an individual’s desire to support a charitable enterprise. Specifically, there is significant debate over presence or absence of the donor’s ego as a motive (I give so that others will see me as a good person) as opposed to a genuine desire to do good (Piliavin and Charng, 1990). There is also debate within the theories

of funding as to how much support should be provided by the government (RoseAckerman, 1986). Recent studies indicate that over $1 trillion of federal funding is devoted to the resolution of social ills. Within the nonprofit sector of the economy, the primary funding source for the majority of the larger enterprises is a governmental grant, subsidy or fee for services (Wolk, 2007). However, there is an open question as to the impact that this governmental support has on the level of private support a charity receives; specifically whether the support of the government increases or decreases the level of private funding (Brooks, 2000). Each of the previously stated theories assumes that a governmental entity is the most effective way to deal with the delivery of social services. Salamon (1995) proposes that it is not the government’s primary role to provide for the care of the less fortunate, but the role of private citizens and the community (referred to as the voluntary sector). This voluntary sector is then the primary source of both the funding for and delivery of services that support social needs. This theory then goes on to discuss how there are inherent flaws in this process, such as insufficient funding, special interests and pet projects, and a paternalistic attitude and ineffective leadership within the philanthropic community (Salamon, 1995). Each theory also assumes that the collected revenues of the sponsoring governmental entity are sufficient to fund the desired program. Unfortunately, that assumption appears to be incorrect in the current economic realities faced by many jurisdictions. Impact of current events In addition to the search for governmental revenue mentioned previously, the current economic crisis has only served to heighten the tensions within each of these theories and constructs. Current worries about the future of the capitalist system (Whitehouse, 2009) echo the ruminations that have been underway for many years regarding the ethical and structural flaws of an economic system that is inherently competitive (Drucker, 1993; Marx et al., 2002; Weber, 1958). In a similar vein, there are longstanding debates over the fate of democracy itself, particularly as it relates to the notions of equity and fairness (Forelle, 2009; Walker, 2009). At the same time, there are new studies that indicate that a social conscience is good for a corporation’s stock price (Kanter, 2009). There are also a number of debates as to how any one of several new model of capitalism could or should work (Bishop and Green, 2008; Kinsley et al., 2008), and why it may or may not be a good idea (Edwards, 2008; Guo, 2006; Hartigan, 2006; Riley, 2009). The impact of this turbulence has been particularly significant in the nonprofit sector due to its dependence on government grants and private philanthropy for its funding (Riley, 2009; Salamon, 1995; Wallace, 2009c). Out of this maelstrom comes a unique notion about how to fund a social benefit organization. The emergence of social enterprise Unlike the private commercial enterprise, the philanthropic community and the wave of nonprofit firms that it has spawned have yet to develop anything like the market and regulatory forces of commerce to oversee, organize or streamline the operations of nonprofits (Hansmann, 1981, 1986; Light, 2008). While often becoming huge enterprises (currently employing over 8 percent of the American private sector workforce; Salamon and Sokolowski, 2005), many nonprofits are not able to sustain their operations in a manner that is taken for granted in the commercial world, and must rely on a steady stream of grants and gifts in order to maintain their efforts

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(Bishop and Green, 2008; Egger and Yoon, 2004). Equally challenging, the means and methods for determining success are not well defined (Light, 2008). Combined with the various economic and political concerns stated above and the worries of the nonprofit sector on how they may impact donation levels (Wallace, 2009a, b, c), this issue has led to the rapid growth of a new model known alternatively as social entrepreneurship, corporate social responsibility and social enterprise (Brooks, 2009; Dees, 2008; Light, 2008). Although there is still debate within the field as to terminology (Bielefeld, 2009; Light, 2008), a few definitional matters do need to be established. Generally speaking, there are two similar terms that are often used interchangeably but are in fact quite distinct. The first and generally broader is social entrepreneurship, which has come to serve as an umbrella term for any number of activities that may or may not include the use of market-based activities to generate funding. These activities typically center on the use of an entrepreneurial approach to solving entrenched social problems by seeking pattern breaking solutions rather than simply doing more of the same thing (Bishop and Green, 2008). In fact, many ventures and individuals that refer to themselves as social entrepreneurs fund their operations from the traditional channels of philanthropy (Light, 2008). The second and narrower term used in this field (and the one more relevant to this discussion) is social enterprise, which refers specifically to those ventures that are generating their operating income from the market and not the donor (Bielefeld, 2009; Brooks, 2009; Light, 2008). Within the emerging field of social entrepreneurship, there are a few scholars that are attempting to define social value as part of a larger equation in an effort to develop a market-based metric for social business (Brooks, 2009; Bugg-Levine and Emerson, 2011). As with the larger field of public administration, there is also discussion within this field as to the difference between output and outcomes in the assessment of social impact (Bugg-Levine and Emerson, 2011; Lynch and Walls, 2009). However, while the commercial aspects of a social business venture are readily measurable and their success is easily evaluated, there remains a great deal of subjectivity around the ability to measure social outcomes, particularly when the matter is made more complex by the attempt to develop a combined set of metrics that takes into account both the commercial operation and the social impact (Bugg-Levine and Emerson, 2011; Light, 2008). Bielefeld (2009) sums up the current debate quite well when he states that “best practices are not standardized”. More importantly for this discussion, “theories of change are not aligned among grantors, investors and nonprofits” (Bielefeld, 2009). In other words, the means and methods that are employed in seeking the social change are openly under debate, and there is a significant disconnect between those funding the change and those actually performing the service. Bielefeld (2009) goes on to state that some of the challenges in this field include “situations were values cannot always be measured, quality implementation of assessment is essential but difficult [y] and time horizons for output and outcome measurement are long.” Nonetheless, Bielefeld (2009) concludes that this field has much promise as a tool for effecting “major and positive” social change. In recent years, significant thought has been given to the factors that can make such a venture successful. Bornstein (2007) identifies a willingness to self-correct, share credit, break free of established structures, cross-disciplinary boundaries, work quietly and have a strong ethical impetus as critical. Crutchfield and Grant (2008) produced a highly touted work that encourages the use of markets as a tool for funding mission, but were not able to separate this idea from the existing nonprofit context. Lynch and

Walls (2009), speaking from a social enterprise context, identify a number of “paradoxes” that must be balanced in order for a venture of this sort to succeed. One of the most critical of these is the balance between commercial and social success. Into this fray steps the social business model of Muhammad Yunus. Yunus’ Social Business model makes several claims that are relevant to the purposes of this study. First and foremost, it is a business, not a charitable venture. Yunus is adamant that the venture must recoup all its expenses through operating activities (Yunus and Weber, 2007). Second, these profits, once generated, stay within the business. After paying all operating expenses, net profit is reinvested in the enterprise and is passed along to the desired beneficiary group in the form of lower prices, better service or a broadening of the constituent base that is served. While the profit motive distinguishes the social business from a true cooperative, it is the use of this profit for a social benefit rather than the creation of personal wealth that separate it from the commercial enterprise (Yunus and Weber, 2007). A close read of Yunus’ work will quickly lead one to understand that what he refers to as a social business is the same animal that is more commonly referred to in the USA as a social enterprise (Lynch and Walls, 2009). It must be noted here that the ultimate ability of the social enterprise model to impact social problems is still actively debated (Edwards, 2008; VanSandy and Baugous, 2009). Further, it is not likely that this model will be the panacea for all the world’s ills. There are most certainly human needs that will always require some sort of charitable or governmental support (Dees et al., 2004; Light, 2008; Wolk, 2007). In addition, most of the current practitioners have yet to build a venture or model of sufficient scale to have anything more than localized impact (Dees et al., 2004). From a social change perspective, the development of that scale will certainly be needed if this model is to become a more significant factor (McAdam et al., 2001). Further, the matter of ultimate impact on society must not be ignored. At the center of these many issues is an open debate as to the amount of revenue derived by commercial activities in a nonprofit as opposed to those derived through donations, grants and gifts (Edwards, 2008; Grimm, 1999; Yan et al., 2009). While several studies have identified that fees for service represent a significant and growing portion of the revenue of a nonprofit, those studies do not distinguish between fees paid by a governmental entity in transfer of payments mode and that earned through the sales of goods and services on the open commercial market (Wing et al., 2008), and some scholars hold forth that government is in fact the major source of funding for the nonprofit sector (Salamon, 1990). Policy options for government Returning to our opening statements, there seem to be three options available to governmental entities facing the conflicting demands of maximizing care for society while minimizing the burdens created by shrinking budgets. The first option is to maintain the tax exemptions for nonprofits in place. While this will certainly help to safeguard the many noble social programs that nonprofits deliver, it will not allow for any progress to be made in reducing budget shortfalls. A second option is to eliminate the tax exemption or seek an alternative method for collecting revenue from tax-exempt entities. Many government entities are using a vehicle known as Payments in lieu of Taxes (Flaherty, 2007; Lustig, 2010). While this will certainly help to generate additional tax revenue for governmental needs, it may also serve to severely constrain the delivery of social services that nonprofits provide by placing additional financial

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burdens on the organization (Brooks, 2000). A third option is to reduce or eliminate the tax exemption while taking additional action to support the continued delivery of social services through social enterprise. One possible vehicle to accomplish this is an emerging entity known as an L3C. Structure of the legal entity As previously discussed, the traditional charitable enterprise is legally structured as a 501(c) 3 entity in order to be able to receive the benefits of various tax exemptions. However, these exemptions also place limitations on the ability of a venture to receive the sort of capital investments that would allow it to grow as a revenue producing enterprise (Miller and Wesley Ii, 2010). In answer to this problem, there is a new corporate entity being implemented in several states in the USA which has been given the name L3C. The L3C is structured as a branch of the LLC form of corporate structure, which makes it a for-profit entity. However, the intention of this form of corporation is that it would allow philanthropic entities to make investments in the venture in a manner similar to that of an angel investor in the traditional for-profit venture, through the use of what is known as a program-related investment. The L3C also allows for additional layers of more commercially oriented investors to participate in the funding of the enterprise. It is hoped that this creative use of a blend of philanthropic and commercially oriented capital will allow for these social business to achieve a level of scale and impact that can move this new model forward. However, at this time the IRS has not issued a definitive ruling on the legalities of such transactions, which forces an entity to request a private letter determination from the IRS if they wish to utilize the benefits of this new form of incorporation. It should also be noted that the L3C’s usefulness is currently a matter of debate, in no small part due to the lack of a definitive ruling from the IRS as to its applicability (Bishop, 2010; Taylor, 2010). Policy proposal Two specific actions are submitted for consideration by policy makers concerned about this matter. First, the current 501(c) 3 tax exemption should be significantly reduced, which would allow for additional tax revenues to be obtained from the nonprofit sector. The exact revenue potential for this recommendation would need to be determined. However, the potential for revenue enhancement is easy to see when one understands that the nonprofit sector has become a major factor in the American economy and currently employs over 8 percent of the American private sector workforce (Salamon and Sokolowski, 2005). This equates to what would be a $42 billion industry (Salamon and Sokolowski, 2005; Wing et al., 2008). While certainly substantial, this estimate my actually underrepresent the actual size of this sector, as it is reported that over $1 trillion of federal funding is devoted to the resolution of social ills (Wing et al., 2008; Wolk, 2007). Applying the standard federal tax rate of 35 percent for corporations, this proposal could generate $14B or more in new tax revenue even if only counting the direct income to nonprofits. Second, the IRS should issue a definitive ruling on the L3C corporation, which would allow it to grow and flourish. Anticipated outcome As – the L3C is a for-profit entity, it would still be subject to corporate income taxes, but better able to serve a social mission. Therefore, it is anticipated that the combined effect of these two actions would be a significant increase in tax revenues without an accompanying loss in social services.

One local example may serve to illustrate the potential for this proposal. In its 2010 annual financial statement (2010), the Johns Hopkins University reported a net operating profit of $83.8 million. As a 501c3, this income is not subject to federal income taxes as it would be if it was a for profit corporation. Using the standard 35 percent federal tax rate, this amounts to a loss of $28.4 million in federal tax revenue. In the same report, the Johns Hopkins University reports an asset value of just over $2 billion in physical property, which consists mainly of land and buildings. Using the business property tax rate for Baltimore City of $5.67 per 100 dollars of assessed value, eliminating this portion of the exemption would generate $113.8 million is property taxes. Interestingly, the Baltimore City office of Budget and Finance (2010) reports an anticipated budget deficit of $112 million for fiscal year 2011. Conclusion While a complete elimination of the tax exemption is not being proposed and would likely be politically unpalatable, it is seems that the potential for significant additional revenue is strong and should be explored further. However, it can also be reasonably assumed that most elected officials would not simply collapse the nonprofit sector as to do so would create a significant public outcry. Reducing or eliminating these tax breaks without a thoughtful plan for transition would also pose significant risk to the may fine social benefit programs currently being delivered by the traditional nonprofit sector. Nevertheless, the alternative offered by the L3C or some other new structure may allow for a reasonable compromise that eases the strain on public budgets without destroying the social support system that the nonprofit community provides. References Baltimore City office (2010), “Summary of the adopted budget”, available at: www.baltimorecity.gov/LinkClick.aspx?fileticket¼3gn0Qy-O5xw%3d&tabid¼215&mid¼ 526 (accessed November 28, 2010). Baumol, W.J. (2002), The Free Market Innovation Machine: Analyzing the Growth Miracle of Capitalism, Princeton University Press, Princeton, NJ. Bielefeld, W. (2009), “Issues in social enterprise and social entrepreneurship”, Journal of Public Affairs Education, Vol. 15 No. 1, pp. 69-86. Bishop, C.G. (2010), “The low-profit LLC (L3C): progam related investment by proxy or perversion”, Arkansas Law Review, Vol. 63, pp. 243-69. Bishop, M. and Green, M. (2008), Philanthro-Capitalism: How The Rich Can Save The World, Bloomsbury Press, New York, NY. Bornstein, D. (2007), How to Change the World, Oxford University Press, Oxford, New York, NY. Brooks, A.C. (2000), “Is there a dark side to government support for nonprofits?”, Public Administration Review, Vol. 60 No. 3, pp. 211-18. Brooks, A.C. (2009), Social Entrepreneurship: A Modern Approach to Social Value Creation, Pearson Prentice Hall, Upper Saddle River, NJ. Bugg-Levine, A. and Emerson, J. (2011), Impact Investing: Transforming How We Make Money While Making a Difference, John Wiley & Sons Incorporated, San Francisco, CA. Clark, G. (2007), A Farewell to Alms: A Brief Economic History of the World, Princeton University Press, Princeton, NJ. Cohen, R. (2010), “Attack of the tax-exemption killers”, available at: www.blueavocado.org/ content/attack-tax-exemption-killers (accessed November 29, 2010).

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