STRATEGIES AT ENTRY OF FOR-PROFIT AND NON-PROFIT FIRMS IN PUBLIC SERVICES: INSIGHTS FROM PRIVATE HIGHER EDUCATION

Abstract

This paper examines the strategies and long-term outcomes of for-profit and non-profit firms when entering markets for public services by employing data from private higher education in Brazil. Using quantitative analysis and qualitative interviews, it finds that, when compared to non-profits, for-profit firms adopted different strategies at entry, with broader service portfolios, more market-oriented offerings, and more flexible human resource management policies. These distinct elements accounted for a significant share of the superior long-term survival and scale achieved by for-profit firms, and without consequences for the quality of services provided. The stronger social mission of a subset of non-profits partially explains these disparities. The findings underscore how for-profits can play a role in expanding access to public services, thus offsetting constraints faced by non-profits.