The civic sector is the most admired and least studied area within national and international economies. Perhaps inattention helps explain the admiration, it being easier to praise what has not been analyzed or harder to theorize what one admires. On standard economic measurements, the nonprofit and nongovernmental organizations making up this sector are not insignificant. According to a report released in 2003, such organizations in thirty-five countries had $1.3 trillion in expenditures as of the late 1990s, a figure that would rank the civic sector in these countries as the seventh-largest national economy in the world. Their civic sector employed more than 39 million full-time-equivalent workers, 57 percent of them paid workers and 43 percent of them volunteers (in full-time-equivalent numbers). The report estimated that 190 million people volunteered in these countries alone, or approximately 221 volunteers per 1,000 members of the adult population. An earlier report released in 1998 said that civic-sector organizations worldwide provided more aid than the World Bank and offered services in areas that many governmental agencies hesitate to enter.

Unfortunately, mainstream economic theories do not adequately capture the reasons why such organizations exist and thrive. These theories also provide little guidance amid signs of turmoil across the entire sector in North America: allegations of overcompensation and fraud among leaders in higher education and philanthropy; proposals to remove exemptions and other tax benefits from religious and cultural organizations; debates about the appropriateness of “commercial” and “political” ventures by nonprofit agencies; conflicts in the United States about federal funding directed at “faith-based initiatives”; and attempts to turn over an increasing share of schooling, research, and health care to for-profit enterprises. These struggles feed on deep-seated and questionable assumptions about the identity and function of civic-sector organizations relative to business and government. In the absence of adequate understanding, responses to the turmoil tend to be myopic and destructive toward an area in society where organizations can imagine and pursue alternatives to “business as usual.”