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Spring 2019
ISSN 0890-913X
Volume 34, Number 1

Hierarchical Management Structures and Housing the Poor: An Analysis of Habitat for Humanity in Birmingham, Alabama

Stefanie Haeffele, Mercatus Center at George Mason University
Virgil Henry Storr, Mercatus Center at George Mason University
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/index.php?action=ajax&rs=GDMgetPage&rsargs[]=2019 Journal of Private Enterprise Vol 34 No 1 Spring PARTE2.pdf&rsargs[]=0
TheJournalofPrivateEnterprise34(1),2019,1537HierarchicalManagementStructuresandHousingthePoor:AnAnalysisofHabitatforHumanityinBirmingham,AlabamaStefanieHaeffeleMercatusCenteratGeorgeMasonUniversityVirgilHenryStorrMercatusCenteratGeorgeMasonUniversity______________________________________________________AbstractHierarchicalmanagementstructuresperformquitedifferentlyinthepublicandprivatesectors.Inthepublicsector,thesestructuresencounterknowledgeproblemsthatimpairtheirabilitytolearnabouttheeffectivenessoftheirprogramsandtheneedtoadjusttheirefforts.Intheprivatesector,however,becausetheymustattractcustomersordonorsinordertoremaininexistence,thesestructuresareepistemicallywellpositionedtoreceivefeedbackontheiroperations.ThisanalysisexaminestheabilityofprivateversuspublicbureaucraciestoprovidehousingforthepoorbyexaminingthehierarchicalstructureandfeedbackmechanismsofHabitatforHumanityincomparisontofederalefforts.Pastgovernmenteffortshavegenerallyfailedtoimprovehousing,resultinginslumsandurbanblight.Conversely,nonprofitorganizationssuchasHabitatforHumanity,whichrelyonhierarchicalmanagementstructuresbuthaveaccesstomorerobustfeedbackmechanisms,haveproventobeeffectiveathousingthepoor.WefocusontheHabitatforHumanityInternationalaffiliateinBirmingham,Alabama,andshowthatithasproducedlastingimprovementsinhousingconditions.______________________________________________________JELCodes:D64,D73,B53Keywords:affordablehousing,nonprofits,HabitatforHumanityI.IntroductionHierarchicalmanagementstructuresperformquitedifferentlyinthepublicandprivatesectors.Inthepublicsector,thesestructuresoftenencounterknowledgeproblemsthatimpairtheirabilitytolearnabouttheeffectivenessoftheirprogramsandtheneedtoadjusttheirefforts.Intheprivatesector,however,becausetheymustattractcustomersordonorstoremaininexistence,thesestructuresare
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