Faithful strategies: How religion shapes nonprofit management

Research output: Contribution to journalArticleScientificpeer-review

Abstract

This paper studies the strategies employed by Catholic and Protestant nonprofit hospitals in Germany and traces them back to the theological foundations of those religions. Using a unique data set, we find that Catholic nonprofit hospitals follow a strategy of horizontal diversification and maximization of the number of patients treated. By contrast, Protestant hospitals pursue a strategy of horizontal specialization and focus on vertical differentiation, putting in more sophisticated inputs and producing more complex services. These effects increase if the environment of a hospital gets more competitive. We present a model that rationalizes the strategic differences as a result of the difference between Catholic and Protestant values identified in the literature. We then test alternative explanations to the observed empirical differences and show that none of them is supported by the data.
Original languageEnglish
Pages (from-to)188-208
JournalManagement Science
Volume65
Issue number1
Early online dateFeb 2018
DOIs
Publication statusPublished - Jan 2019

    Fingerprint

Keywords

  • nonprofits
  • not-for-profit sector
  • religious values
  • religious organizations
  • Catholicism and Protestantism

Cite this