Boulding, Kenneth Ewart
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Boulding was one of very few major economists who devoted significant time and major publications to the economics of the Nonprofit Sector (NPS) or Civil society (CS). He invented the term grants economy, which he contrasted with the market or exchange economy, studied by 99%+ of other economists at the time (1966). He was elected president of the American Economics Association (1968), a highly prestigious honor. Boulding Co-founded (1968) and was long-time (1970–1989) President of the Association for the Study of the Grants Economy (ASGE), which still exists as a small but persisting set of economists following his lead.
Basic Biographical Information
Kenneth Boulding was born January 18, 1910, in Liverpool, England. He graduated in 1931 from Oxford University with first class honors in Philosophy, Politics, and Economics (B.Litt.). Although he did some post-graduate work elsewhere, he never earned a higher degree. In 1936, Boulding emigrated permanently to the United States, becoming a US citizen in 1948. Boulding spent most of his career as a Professor of Economics at the University of Michigan (1949–1967) and then at the University of Colorado at Boulder (1967–1980), subsequently a Distinguished Professor Emeritus. Boulding died in the USA in March 1993.
Although principally an economist (J. B. Clark Medal, 1949; President of the American Economics Association, 1968), Boulding’s greatest contributions to civil society/nonprofit sector studies came from his broad, interdisciplinary interests and work. He attempted to broaden the narrow, highly mathematical, and profit/“utility”-oriented approach of economics. He argued forcefully for economists to include less precise and more interdisciplinary approaches to understanding human behavior and groups. Boulding was convinced, unlike most economists, that human behavior can only be understood by studying people in their totality.
Boulding was the first major economist to give careful attention to the nonprofit sector/civil society. He concluded that in studying only the “exchange” economy, economists were missing a great deal of important economic activity. In a 1966 article, he wrote that economists needed to grapple with the “grants economy,” which was his term for what non-economists see as the financial part of the nonprofit sector. Elaborating on this theme with others, Boulding co-founded (1968) the Association for the Study of the Grants Economy/ASGE, which still exists. He was President of ASGE from 1970 to 1989.
The exchange economy usually studied by economists involves two parties each giving something to the other (usually money for goods or services) so that the net worth of each party is unchanged. But in the grants economy, transfers between two parties/entities result in the reduction of the net worth of one party (the grantor) and increase in the net worth of the other party (the grantee). Both charitable giving by individuals and by organizations (e.g., foundations, corporations) meet this criterion, because Boulding interprets the term “grants” quite broadly. In nonprofit studies, the focus is usually on (voluntary) grants made out of altruism or “love” in Boulding’s terms. But there is also the “threat” (coercive) grants economy, as when a thief steals from us, or when some government taxes us. Boulding’s classic discussion of the grants economy was published first in his book The Economy of Love and Fear (1973).
Boulding was unique in first hinting at the historically recent revolutionary growth of associations in his book The Organizational Revolution (1953), referring to the past two+ centuries. In a later journal article, D. H. Smith (1972) first expanded on this idea for the nonprofit sector and volunteer/grassroots associations specifically, as a global associational revolution. More recently, Smith (2019, Section 4.1) has argued that Boulding’s suggested organizational revolution in conjunction with the Industrial Revolution was in fact the third of four, distinct, global associational revolutions, each precipitated by a different economic system revolution. Ignoring the history of nonprofit studies/voluntaristics, other academics have mistakenly written recently about the global associational revolution (1950+) in post-industrial, service-information-technology societies as if it were the first one (Casey 2016; Salamon 1995). In fact, it is the fourth one in human history, the first one occurred about 10,000 years ago and earlier.
- Boulding, K. E. (1953). The organizational revolution. New York: Harper.Google Scholar
- Boulding, K. E. (1973). The economy of love and fear: A preface to grants economics. Belmont: Wadsworth.Google Scholar
- Casey, J. (2016). The nonprofit world: Civil society and the rise of the nonprofit sector. Boulder: Lynne Rienner Publishers.Google Scholar
- Salamon, L. M. (1995). The global associational revolution: The rise of the third sector on the world scene. London: Demos.Google Scholar
- Harris, B., Morris, A., Ascough, R. S., Chikoto, G. L., Elson, P. R., Mc Loughlin, J., Muukkonen, M., Pospíšilová, T., Roka, K., Smith, D. H., Soteri-Proctor, A., Tumanova, A., & Yu, P. (2016). Chapter 1: History of associations and volunteering. In D. H. Smith, R. A. Stebbins, & J. Grotz (Eds.), The Palgrave handbook of volunteering, civic participation, and nonprofit associations. Basingstoke: Palgrave Macmillan.Google Scholar