Contact The Editor
Articles By This Author
The evidence continues to accumulate that America's nonprofit sector is failing the country in some basic ways. Specifically, it is not doing enough to break down unjust inequalities and barriers to opportunity.
Consider nonprofit hospitals. According to the data, nonprofit hospitals barely behave differently than for-profit hospitals. They do not charge systematically lower prices or somehow do more to help people. Some studies show slight differences, but it's hard to argue that non-profit hospitals are more charitable or have more altruistic priorities.
Another example: prestigious universities. At Harvard, for example, more than two-thirds of the undergraduates come from the top 20% of the income distribution, while only 4.5% come from the bottom 20%. Given that Harvard has an endowment of roughly $50 billion and enjoys tax-free status, it might be expected to distribute its benefits more evenly — if only to avoid the bad publicity. (Disclosure: I work at a nonprofit university and have a degree from Harvard.)
At this point, I'm no longer surprised when I read a study detailing how inegalitarian some nonprofit institutions are. So I was pleasantly surprised to read an investigation, released last week, that took a novel approach: It used geolocation data to examine which places are the best — and which the worst — at bringing rich and poor Americans together.
Unfortunately, museums scored especially poorly, and of course most of them are nonprofits. Nor do churches fare well, even though their rhetoric tends to be very friendly to the poor. And there are many places in the for-profit private sector that do badly. Drugstores, for instance, tend to be very local, and their customers reflect the income segregation of their neighborhoods.
And which are the best at attracting customers from all income levels? Chain restaurants. Not necessarily fast-food places, but so-called casual restaurants. As it turns out, the rich and poor in America only truly come together at places like Olive Garden and Applebee's.
Where I live, in northern Virginia, I have noticed that high-quality but cheap Chinese restaurants have an especially mixed clientele. The combination of lower prices and regional cuisine, which can be a signal of refined taste, seems to appeal to a wide demographic.
These kinds of restaurants manage to mix the rich and poor by creating an environment in which a lot of the traditional status markers are absent. None of these places could be described as fancy, and the mixing occurs partly because many higher-income customers are willing to do without the trappings of their local country club (to their benefit, I might add).
These findings raise a question: If the goal is to become more egalitarian, is there anything America's nonprofit institutions can learn from its casual restaurants?
One lesson is that it's harder to convince poorer individuals to mingle with wealthier individuals in settings where the culture is shaped to align with a higher socioeconomic status. Churches, for instance, are usually free and open to all — but the poor do not seem so keen on attending religious services in wealthier neighborhoods. Maybe that's because they don't view the wealthier church as a “better service” (however that might be defined) but rather as an environment where they do not feel entirely comfortable or welcome.
In other words: Wealthier institutions or establishments attract a mixed customer or user base only when they give up cultural control. Taller stained-glass windows and more comfortable pews can do only so much to attract lower-income churchgoers. (An aside: One nice feature of marketing “culture” — for lack of a better word — on the internet is that it can be broadly appealing. Classical music on YouTube, for example, is not only free but also free of snob appeal.)
The business model of America's nonprofit sector depends on producing status and reputation, both for itself and its affiliates. Many nonprofits work at creating environments of a very particular sort, both to raise money and to boost their influence. To elites, those environments are innocuous, even inspiring. But those same elites are starting to realize that what is inviting to one person is off-putting to another.
To be fair, the question of how to be more egalitarian plagues more than just the nonprofit sector. The rise of populist politics around the world, for example, can in many ways be explained by the failure of elites and experts to tailor their appeal to ordinary voters.
I will not pretend that Olive Garden is my favorite restaurant. I will say, however, that this latest research gives me a newfound appreciation for it.
(COMMENT, BELOW)
Cowen is a Bloomberg View columnist. He is a professor of economics at George Mason University and writes for the blog Marginal Revolution. His books include "The Complacent Class: The Self-Defeating Quest for the American Dream."
Previously:
• 08/02/23 Why 'Barbie' tickets aren't more expensive
• 06/07/23 Would you let Elon Musk implant a device in your brain?
• 05/10/23 Second-guess AI 'experts'
• 03/14/23 Governments should compete for residents, not businesses
• 02/22/23 Economists finally have a good excuse for being wrong A land tax won't make cities more affordable
• 01/26/23 Economists finally have a good excuse for being wrong
• 01/24/23 AI is improving faster than most humans realize
• 12/27/22 Beware the dangers of crypto regulation
• 12/27/22 Americans have found their happy place
• 12/14/22 The real risk of higher inflation is lower wages
• 12/07/22 Fight poverty, not income inequality
• 10/10/22 A crisis is coming in Europe. The only question is, which kind?
• 09/06/22 What is the purpose of public policy?
• 08/15/22 The future of travel is less exotic
• 08/01/22 Welcome to the era of antisocial media
• 07/25/22 Biden's COVID diagnosis is a wake-up call for America
• 05/12/22 A nuclear strike might not prompt the reaction you expect
• 03/22/22 Doomscrolling has ruined our sense of time
• 01/22/22 Wokeism has peaked
• 01/31/22 The latest bias to worry about
• 01/17/22 America's loneliness epidemic
• 01/07/22 Some of America's top universities just revealed they're not morally serious
• 12/29/21 America would be more happy with more people
• 12/10/21 Bill Gates, Jeff Bezos, Elon Musk . . . and Paul McCartney
• 12/08/21 The only two pieces of advice you'll ever need
• 11/29/21 Nuclear fusion is close enough to start dreaming
• 10/27/21 America's national mood disorder
• 06/10/21 Lifting of mask mandates poses a challenge for Libertarians
• 05/28/21 Why economics is failing us
• 04/19/21We need green energy. We don't need green jobs
• 04/14/21 Libertarianism isn't dead. It's just reinventing itself
• 04/05/21 What does the world need? More humans
• 02/10/21 If Biden goes big now, he may have to go small later
• 01/12/21 Covid improved how the world does science
• 12/07/20 How to make sure your complaint is heard
• 10/27/20 It's getting better and worse at the same time
• 09/14/20 How to be happy during a pandemic
• 09/04/20 Trump is winning the vaccine debate with public health experts
• 07/01/20 Why Americans are having an emotional reaction to masks
• 05/20/20 Covid-19 will expose the ghosts in the U.S. economy
• 05/07/20 Are aliens visiting us? US military seems to think so
• 05/06/20 America's reopening will depend on one thing --- trust
• 04/22/20 How the covid-19 recession is like World War II
• 04/15/20 America is returning to 1781
• 04/08/20 Covid-19 is is upending everything for status seekers
• 03/17/20 The coronavirus will usher in a new era of entertainment
• 01/28/20 Social Security isn't doomed for younger generations
• 01/08/20 Why 2020 is harder to predict than 2019 was
• 12/02/19 Equality is a mediocre goal so aim for progress
• 11/25/19 Inflation inequality creates winners and losers
• 11/09/19 OK kids. This boomer has had enough
• 10/20/19 Would you bet against Trump in 2020?
• 09/25/19 The right industrial policy for America
• 09/24/19 Harvard's legacies are nothing to be proud of
• 09/02/19 Yes, the Fed could still stop a recession
• 08/20/19 A trade deal with China wouldn't change much
• 07/29/19 How your personality traits affect your paycheck
• 07/16/19 Internet 101 should be a required class
• 05/28/19 How Dems actually are the ANTI-immigrant party
• 04/23/19 Want to help fight climate change? Have more children
• 03/22/19 America isn't as divided as it looks
• 03/12/19 The Twitter takeover of politics: You ain't seen nothing yet
• 03/04/19 How to tell which Dem dreams won't come true
• 02/07/19: Now the Dems want to end America's nuclear first strike option. How clueless is that?
• 01/29/19: The shutdown hit a lot of government workers --- hard. But, ultimately, who is responsible for their unfortunate circumstances?
• 12/12/18: The West is abusing its legal power to punish people or institutions that do things it doesn't like. It better stop
• 10/23/18: The US needs Saudi Arabia, and vice versa
• 10/19/18: The right finds the perfect weapon against the left
• 07/24/18: The drive for the perfect child gets a little scary
• 06/04/18: Side effects of the decline of men in labor market
• 05/14/18: Proving Marx's theories right
• 05/08/18: Holding up a mirror to intellectuals of the left
• 05/01/18: Virtual reality will make lives better ... mostly
• 04/16/18: It's hard to burst your political filter bubbleIt's hard to burst your political filter bubble
• 04/09/18: The missing key to grasping why American politics seems to have become more polarized, with no apparent end in sight
• 04/05/18: Two American power centers are about to clash
• 03/22/18: We fear what we can't control about Uber and Facebook
• 03/08/18: How to stop the licen$ing insanity
• 01/10/18: Polarized Congress needs to bring back earmarks
• 12/27/17: The year when the Internet collides with reality
• 11/07/17: Would you blame the phone for Russian interference?
• 10/23/17: North Korea is playing a longer game than the US
• 10/12/17: Why conservatives should celebrate Thaler's Nobel
• 08/02/17: Too many of today's innovations are focused on solving problems rather than creating something new