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Does Electronic Disclosure Affect Contributions to Nonprofit Organizations?
Shirley A Hunter,
Tufts University
Royce D Burnett, University of Miami
Janet Takaringwa, Simmons College
ABSTRACT. Our research proposal investigates if the electronic disclosure of financial information affects contributions to nonprofit organizations (NPOs)? To conduct this inquiry, we regressed the change in total revenues of the top 100 NPOs on aspects of disclosure for the sample period 1998 to 2004. The preliminary results from our study are negative. Results obtained found that high levels of information asymmetry do not affect donors. Specifically, our results show that although revenues for our sample of NPOs increased to $49.7 billion in 2004, many of the NPOs did not file timely and accurate financial reports and Form 990s nor posted such information to their websites. This leads us to conclude, preliminary, that contributions to NPOs may be motivated more by the program objectives of the NPOs rather than their adherence to mandatory or voluntary disclosure requirements.
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