Neighborhood Effects on Organizational Outcomes: Examining Drivers of Philanthropic Investment.

The neighborhood effects literature establishes that neighborhood attributes impact social outcomes such as academic achievement of school children (Sampson et al, 2002; Leventhal and Brooks-Gunn, 2000; Duncan and Raudenbush, 1999). This research considers both demographic attributes of people who comprise communities (e.g. age, poverty level), as well as social-organizational process that occur at the community level (e.g. resident participation in local community organizations). If neighborhood attributes impact outcomes for individuals do they also affect organizational outcomes? Organizational outcomes such as the accessibility of employees or volunteers or the proximity of clients or a service population could be influenced by community contexts. This paper investigates neighborhood effects on a particular organizational outcome, philanthropic funding. More specifically, this paper examines variation in foundation grantmaking to nonprofit organization across communities in Chicago, Illinois. Do neighborhood characteristics attract funding to nonprofits in certain areas of the city? In addition demographic and infrastructure characteristics, how do social-organizational processes such as the level of protest activity in specific neighborhoods influence philanthropic funding? Analysis of grants made to nonprofits in Chicago in 1995 indicates that neighborhood attributes including financial need, existing organizational infrastructure, prior investment in the neighborhood, and neighborhood based grassroots activity all influence philanthropic investment. [ABSTRACT FROM AUTHOR]