The Paradox of Nonprofits

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Nobel Prize-winning economist Gene Fama looked at the nonprofit as a form of financing that is designed to attract capital. He found that people are willing to make voluntary contributions to public goods, and it's not true that markets can't provide these things. For profit, price-driven markets may not be able to provide public goods, but nonprofits are pretty good at providing them.

Economist and author Michael Munger of Duke University talks about his book, Tomorrow 3.0, with EconTalk host Russ Roberts. Munger analyzes the rise of companies like Uber and AirBnB as an example of how technology lowers transactions costs. Users and providers can find each other more easily through their smartphones, increasing opportunity. Munger expects these costs to fall elsewhere and predicts an expansion of the sharing economy to a wide array of items in our daily lives.