Nonprofits in Crisis: Economic Development, Risk, and the Philanthropic Kuznets Curve

By Nuno S. Themudo | Go to book overview

1
A Cross-National Philanthropic Puzzle

“SOMETIMES THINGS GET worse before they get better”—Doña Mica reflected during an interview.1 She was apologetic about the fact that her new initiative, which focused on building the capacity of indigenous youth to develop microenterprises, was rapidly losing money. Yet she remained confident that Fovaso—a small nonprofit organization in Central Mexico—would soon be financially viable again. When Fovaso’s financial woes began, the organization embarked on a major strategic reorientation, phasing out its philanthropic programs to focus on social enterprise. As she explained, the hope was that a commercial model based on lending and selling rather than giving to clients would offer a more financially sustainable and potentially more effective approach to fighting poverty. Her sanguine outlook, however, was hard to understand. Survival of small nonprofit organizations in Mexico is challenging in the best of times. But when I interviewed Doña Mica, Mexico was in the midst of the so-called Tequila Crisis, which “caused one of the worst recessions to hit an individual country since the 1930s” (Krugman 2008:32). The stock market had recently lost almost half of its value, unemployment was at record high levels, and Mexico’s risk premium was the highest in the world.2

At the time, no one knew how deep the crisis was going to be. Eventually the economy did improve, and Fovaso experienced some temporary financial relief. Over time, however, Fovaso’s troubles returned. Ironically, the new social enterprise model alienated supporters of the previous model and failed to attract sufficient new support, leading to a reduction in social impact and financial decline. The fate of Fovaso was important because it was one of the few nonprofits in Mexico dedicated to the welfare and empowerment of two of its most vulnerable groups: rural indigenous women and children with special needs. To witness the decline of this valuable organization, which at its peak had employed more than forty people, was devastating for its clients, already hard hit by the crisis. Learning that Fovaso closed its doors in the early 2000s was also difficult for me, because I had previously volunteered a great number of hours to the organization. After almost a decade since its demise, no organization has stepped in to fill the vacuum in poverty alleviation work left by Fovaso’s disappearance.

This book focuses both on the nonprofit sector in general and on specific cases studies of Mexican nonprofits like Fovaso, which tried to work and survive—not always successfully—in a risky environment. Study of these organizations’ local vicissitudes generates broader lessons about philanthropy and the nonprofit sector, which perfectly complement wider cross-national statistical analysis. The main argument proposed here is that the apparently simple notion of risk helps explain the fundamental and contradictory influence of economic development on the nonprofit sector.

-1-

Notes for this page

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items
Notes
Cite this page

Cited page

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Note: primary sources have slightly different requirements for citation. Please see these guidelines for more information.

Cited page

Bookmark this page
Nonprofits in Crisis: Economic Development, Risk, and the Philanthropic Kuznets Curve
Table of contents

Table of contents

Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this book

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen
Items saved from this book
  • Bookmarks
  • Highlights & Notes
  • Citations
/ 210

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Search by... Author
    Show... All Results Primary Sources Peer-reviewed

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.