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Nonprofit charities and foundations hold endowments and other investments. How do their investments perform? Some high-profile nonprofit endowments, importantly those of colleges and universities, have been studied before. This study is the first, to our knowledge, that looks at a large number of the diverse types of nonprofits. We investigate the determinants of investment performance using a large panel data set culled from the 990 forms nonprofits must file annually with the IRS. In this first part, we discuss our approach and the challenges of using these data to infer investment returns. The IRS data, though less than perfect, yield valuable measures of the investment returns of nonprofits. They reveal that some charities do consistently better in their investment returns than do others.


Pre-publication version of article published as:

Heutel, G., & Zeckhauser, R. (2014). The Investment Returns of Nonprofit Organizations, Part I. Nonprofit Management and Leadership, 25(1), 41-57. doi: 10.1002/nml.21100

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