Risky Business: the Risk-Reward Trade-Off Is Different For Nonprofit and For-Profit Firms

We find that consumers penalize nonprofits that choose a risky (but high expected value) option over a certain (but low expected value) option, however, they do not similarly penalize for-profit companies that choose the same risk. This pattern occurs because risk-taking activates paternalistic attitudes toward nonprofit organizations, decreasing support.


Rachel Gershon, Cynthia Cryder, and Merriah Croston (2019) ,"Risky Business: the Risk-Reward Trade-Off Is Different For Nonprofit and For-Profit Firms", in NA - Advances in Consumer Research Volume 47, eds. Rajesh Bagchi, Lauren Block, and Leonard Lee, Duluth, MN : Association for Consumer Research, Pages: 93-98.


Rachel Gershon, University of California San Diego, USA
Cynthia Cryder, Washington University, USA
Merriah Croston, Washington University, USA


NA - Advances in Consumer Research Volume 47 | 2019

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