The Relationship Between Nonprofit Density and Socioeconomic Indicators in an Emerging Country

Abstract In this study, we examine the relationship between the density of nonprofits from five different subfields in a municipality and its socioeconomic indicators using available data from Brazil in the years of 2015 and 2016. The literature on nonprofit density is relevant in enhancing the understanding of the role of the nonprofit sector, evaluating its efficiency, and responding to the increasing demand for accountability. However, researchers have criticized the lack of sample representation in studies on this topic, which are mostly concentrated in large US cities. Using pooled OLS regression models, we show that Brazilian municipalities with better levels of development in terms of education, health, and employment and income have a greater number of nonprofit organizations in their territory. Our results partially support interdependence theory by highlighting the availability of resources as an important driver of nonprofit density.