All earned revenue is not created equal: Revenue embeddedness as a framework for exploring crowding-in/crowding-out effects

Abstract

Nonprofit organizations increasingly rely on earned revenue to sustain their mission-driven activities. Previous research examining the effects of earned revenue on other income streams tends to study earned revenue in the aggregate. Using panel data from 12,372 organizations from 2010-2015, this analysis uses a framework of revenue embeddedness to link earned revenue activities to mission and analyze the effects of earned revenue activities on donations. Earned revenue activities offering new products or services to existing donors appear to complement individual donations. These findings have theoretical and practical applications related to how nonprofits pursue earned revenue.