International Grantmaking by American Foundations

Abstract

Why do American foundations make international grants to certain nonprofits and not others? Numerous studies have examined the determinants of American bilateral foreign aid allocation, but little attention has been paid to the drivers of private aid, including foundation grants. The number of foundations in the United States is growing consistently, as is the amount of grants they distribute. As inequality increases and private wealth becomes more concentrated in the United States, we can expect even more foundations to distribute private aid and potentially channel nonprofit recipients' priorities. Yet, even as nonprofits more generally are receiving increasing attention in political science, public policy, and other disciplines, foundations tend to be ignored by scholars despite their potential for monetary and ideological power. To study grantmaking by American foundations, I adopt a multi-method approach focusing on three factors: their external environment, internal organizational dynamics, and the interpersonal relationships of their staff and trustees with recipient organizations. First, I examine how factors that affect governmental foreign aid distribution may also influence American foundations' international grants. Using a panel of 146 countries for the 2003-2011 time period, I find that self-interest, U.S. foreign policy objectives and need in recipient countries influence foundations. Second, I focus on the internal dynamics within foundations during the grantmaking process through case studies. Here, I focus on how size, organizational structure, and internal politics influence funding priorities, the grantee selection process, and grant turnover. Third, I study how interpersonal networks between foundations and potential grantees affect grantmaking using social network and multivariate analysis. I expect that interlocking boards of directors between foundations and nonprofits will act as a channel for "connected" nonprofits to send and receive important information, thus making them more likely to receive grants.