Irreversible rise of non-profit activity

Context: The non-profit sector deserves attention as its role in the economy looks set to grow dramatically.

Growth of Non-Profits in India: 

• Rising number of non-profits: Because of a huge unmet demand for public goods and services. 

• More than 3 million registered NGOs: One NGO for every 400 citizens

• Purpose of NGOs:
• Achieve goals such as preventing pollution, saving wildlife, etc.
• E.g. closure of a Sterlite plant in Tamil Nadu 
• Some engaged in activities like Money laundering 

Some realities of the economy : 

• Human skills trumped by machines: Hence, jobs depend on making human skills compatible with machines 

• High demand for super-skills and learnable skills: the main reason for the jobs crisis.

• Abundant resources for human survival available: Their distribution is the problem

• Output of goods and services moving into the non-monetizable part of the economy, Hence disappear from GDP

• E.g. Media sector 
• The above facts hint towards a new global economy polarized between:
• A market economy that produces goods and services efficiently, and
• A non-market economy distributes goods and services, almost like NGOs 
• The market economy may increasingly depend on non-profits. Hence, non-profits will be quite crucial 

Evidence of rising significance of Non-Profits: 

•  Employment guarantee schemes
•  Income-distribution schemes unrelated to work
•  Cash payouts
• E.g. Universal Basic Income, Jan Dhan Yojna
• Loan write-offs and waivers
• Corporate Social Responsibility  

Way forward:

• Governments need to make the non-profit sector more efficient and vibrant
• Non-profits deserve deregulation as the mainstream corporate sector
• Enlightened leadership and greater professionalization in this sector 

Conclusion: The non-profit sector plays a huge role in the economy. We should make them more responsible and productive, and less obstructive.