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S Rengasamy, Madurai Institute of Social SciencesIntroduction to NGO Management1
The term, "non-governmental organization" or NGO, came intocurrency in 1945 because of the need for the UN to differentiate inits Charter between participation rights for intergovernmentalspecialized agencies and those for international privateorganizations. At the UN, virtually all types of private bodies can be recognized as NGOs. They only have to be independent fromgovernment control, not seeking to challenge governments either as a political party or by a narrow focus on human rights, non- profit-making and non-criminal.The structures of NGOs vary considerably. They can be globalhierarchies, with either a relatively strong central authority or amore loose federal arrangement. Alternatively, they may be basedin a single country and operate transnationally. With theimprovement in communications, more locally-based groups,referred to as grass-roots organizations or community basedorganizations, have become active at the national or even theglobal level. Increasingly this occurs through the formation of coalitions. There are international umbrella NGOs, providing aninstitutional structure for different NGOs that do not share acommon identity. There are also looser issue-based networks andad hoc caucuses, lobbying at UN conferences. In environmental politics, this occurs in the unique form of the nine "Major Groups", listed in
 Agenda 21
.At times NGOs are contrasted with social movements. Much as proponents of social movements may wish to see movements as being more progressive and more dynamic than NGOs, this is afalse dichotomy. NGOs are components of social movements.Similarly, civil society is the broader concept to cover all socialactivity by individuals, groups and movements. It remains a matter of contention whether civil society also covers all economicactivity. Usually, society is seen as being composed of threesectors: government, the private sector and civil society, excluding businesses. NGOs are so diverse and so controversial that it is not possible tosupport, or be opposed to, all NGOs. They may claim to be thevoice of the people and to have greater legitimacy thangovernments, but this can only be a plausible claim under authoritarian governments. However, their role as participants indemocratic debate does not depend upon any claim torepresentative legitimacy.
 VOLUNTARY ORGANIZATIONS/NON GOVERMENTAL ORGANIZATIONS/NON PROFIT ORGANIZATIONS
“Voluntarism” derived from Latin word ‘voluntas’ means ‘will’ (i.e. impulse, passion, desires,appetite) ‘will’ is prior to or superior to the ‘intellect’ or ‘reason’. It is the will that producedmiracles and there by some of the social evils of which the unfortunate sections of the society arethe victims can be eradicated. All thevoluntary organizations are theexpressions of ‘human will’.The term volunteer is normally usedto denote someone who offers unpaidservice to a good cause.Voluntary agency is a grouporganized for the pursuit of oneinterest or of several interests incommon usually it is contrasted withinvoluntary groups like kin groups,castes, social classes, communities.Voluntary agency is a group of  persons, organized on the basis of voluntary membership, without statecontrol, for the furtherance of somecommon interest of its members.A voluntary organization, properlyspeaking is an organization which,whether its workers are paid or unpaid, is initiated and governed byits own members without externalcontrol- a private enterprise for social progress – William Beveridge. NGO – that are neither govt. nor for  profit. Economic orientation is non- profit. NGO vs. for profitCatering the needs of socialdiversity–e.g. English mediumschoolsSolution to some problems needs experimentation and flexibility- NGOs are open & flexiblewhereas bureaucrats are inflexible & conservatives.
 
 
S Rengasamy, Madurai Institute of Social SciencesIntroduction to NGO Management2
Meaning of Subsidy A benefit given by the government to groups or individuals usually in the form of a cash payment or taxreduction. The subsidy is usually given to remove some type of burden and is often considered to be inthe interest of the public.Financial assistance, either through direct payments or through indirect means such as price cuts andfavorable contracts, to a person or group in order to promote a public objective. Subsidies totransportation, housing, agriculture, education, mining, and other industries have been instituted on thegrounds that their preservation or expansion is in the public interest. Subsidies to the arts, sciences,humanities, and religion also exist in many nations where the private economy is unable to supportthem. Examples of direct subsidies include payments in cash or in kind, while more-indirect subsidiesinclude governmental provision of goods or services at prices below the normal market price,governmental purchase of goods or services at prices above the market price, and tax concessions. Although subsidies exist to promote the public welfare, they result in either higher taxes or higher pricesfor consumer goodsTypes of subsidies1. Direct subsidies 2.Indirect Subsidies 3.Labor subsidies 4.Tax Subsidy 5.Perverse subsidies6. Production subsidies 7.Regulatory advantages 8.Infrastructure subsidies 9.Trade protection (Import)10.Export subsidies (trade promotion) 11.Procurement subsidies 12.Consumption subsidies
Theories of Voluntarism
There are certain economic
 
and organizational theories that need to be understood in order to knowwhy we need voluntary organizations at all.
1.Public Goods Theory 2.Consumer Control Theory 3.Subsidy Theory 4. Market Failure Theory5.Govt (Contract) Failure Theory 6. Etzoni’s organizational Typologies 
Public Goods Theory
.
Public goods Theory
Public goods – enjoyed by everyone without payment or payment. So consumer won’t willingto pay from which others benefit equally at no cost – so markets produce public goods. Butgovt. either has to produce it directly or encourage others to produce it- but the govt. provides onlyfor the median voter.But some may want to get more public good than the govt. is willing to provide. To obtainadditional quantity – they may start public services. Thus, the action of the non-profit organizationis explained as a private response to market failure.
Consumer Control Theory– [to avoid middle man – e.g. co-operative societies]Subsidy TheoryPublic Goods:
Goods or services which, if they are provided at all, are open to use by all membersof society. Examples include aided primary schools, law and order, govt. hospitals, public hospitals,and parks. As nobody can be excluded from using them, public goods cannot be provided for privateprofit.
Terminology, and types of public goods
Excludable Non-excludableRivalness
Private goods(
food, clothing,toys, furniture, cars
 
Common goods
/ (
Common-poolresources
) fish, water, air, CPR Non- rivalness
Club goods
cable television
Public goods
national defense, free-to-air TV Non-rivalness and non-excludability may cause problems for the production of such goods. Thesegoods may lead to instances of market failure, where uncoordinated markets driven by partiesworking in their own self interest are unable to provide these goods in desired quantities. Theseissues are known as public goods
 
problems.
 
 
S Rengasamy, Madurai Institute of Social SciencesIntroduction to NGO Management3
In economics, a market failure is a situation where in the allocation of production or use of goods andservices by the free market is not efficient. Market failures can be viewed as scenarios where individuals'pursuit of pure self-interest leads to results that can be improved upon from the societal point-of-view.
Market failure:
 
 A brief label for the view that the market does not provide a panacea for all economicproblems. There are various ways in which an unregulated market may fail to produce an ideal state of affairs. The main sources of market failure are monopoly, externalities and income distribution. Profitmaximization under monopoly implies under-provision and over-charging for goods. If the production orconsumption of a good involves external economies, it is under-provided by an unregulated market.
 
Traditional nonprofit theories, including the Market/government failure theory, the Contract failure theorythe Voluntary failure theory, are basically sector-based functionalistic theories, each of which gives justification to intervention of a particular sector with the recognition of the limitations of the other twosectors.From the perspective of function transfer, what is implicit in the Market/government failure theory is thatservice function transfers from the market to government and then from government to nonprofits. TheContract failure theory has almost the same dimension, although slightly different. Therefore, Hansmann(1980) suggests that contract failure is in its nature a sort of “market failure.” In contrast, the Voluntaryfailure theory supplies an alternative explanation regarding the sequence of function transfer; that is,social services move from the market to nonprofits and then from nonprofits to government
Market Failure TheoryContract Failure Theory
Three Sectors
Commercial Government Voluntary Sector
1. Primary Concern Produce Goods & ServicesPreserve socialorder Actualize socialvisions2. PrincipalMechanismMarket BureaucratichierarchyConsensus3. Co-ordinationMechanismNegotiated Authority & CoercionShared values4. EnforcementMechanismContractsReciprocity ormsSupervision andrulesMoral obligation5. Prototype Corporation Army Church6. Sanctions State Authority Financial Social pressure
Attributes of Voluntarism
Voluntary energy * Low in cost * inexhaustible quantity * Self generatingSupport for voluntary action mainly comes froma. Anti-statism -Stateless society. (E.g. Gandhi)Violence of private ownership is less injurious than violence of state b. Traditional social collectivismPhilanthropy Mutual Aid Mutual Aid It indicates pro-social behavior of all typesCompassion, concern for collective good, selfless service.
Three perceptions of (Concept of) voluntarism
(Harold L. Wilensky)
1.
 
Voluntarism as an ideology:
Method- Philanthropy & self-help to solve problems
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