WP 08 | 10 Reconceptualising the third sector: toward a heterodox perspective

The paper explores the way the work of classic institutionalist authors can inform modern nonprofit economics. From the perspective of Thorstein Veblen, nonprofit organisation is explained as an institutional consequence of the pecuniary-industrial dichotomy. John R. Commons’ institutional economics is used to highlight the role of nonprofit organisation in eliminating excessive scarcities of vital goods, thus achieving a more reasonable standard of living in a society. In the theoretical system of Clarence Ayres, nonprofit organisation is shown to embody a particular stage in the progressive weakening of the institution of private property in response to technological imperatives. The paper concludes with discussing nonprofit organisation as a conceptual link in reconciling the institutionalist paradigms of instrumental value and reasonable value.