Nonprofit Organizations

“Not-for-Profit” Most businesses operate for the profit of their owners Nonprofit organizations work in a businesslike way to promote collective interests of its members rather than financial gains for the owners

Community Organizations Schools, churches, hospitals, welfare groups, and adoption agencies Many are incorporated to take advantage of unlimited life and limited liability Similar to profit-seeking businesses but do not issue stock, pay dividends, or pay income taxes If business activities generate a profit, they use the surplus to further their work

Cooperatives A voluntary association formed to carry on some kind of economic activity that will benefit its members 3 categories Consumer Cooperative – Buys bulk amounts of goods on behalf of its members. Members help keep prices down by devoting several hours a week or month to the operation. Service Cooperative – Provides services such as insurance, credit, or child care to its members rather than goods, i.e. credit union Producer Cooperative – Helps members promote or sell their products. In the US, most are made up of farmers.

Labor Unions An organization of workers formed to represent its members’ interests in various employment matters Participates in collective bargaining, negotiating with management over issues

Professional Associations Consists of people in a specialized occupation interested in improving the working conditions Influence the licensing and training of their members, set standards for conduct, and are actively involved in political issues American Medical Association, American Bar Association

Business Associations A collective of businesses that organize to promote their collective interests Most communities have a Chamber of Commerce, which promotes the welfare of local businesses The Better Business Bureau, a nonprofit sponsored by local businesses, provides general information on companies, maintains records of consumer inquiries and complaints

Government Direct Role Indirect Role Produces and distributes goods and services Tennessee Valley Authority supplies electric power Federal Deposit Insurance Corporation (FDIC) provides insurance on deposits in our nation’s banks USPS Indirect Role Acts as an umpire to help the market economy operate smoothly and efficiently Because of lack of competition, regulation keeps certain utilities at a fair price