Following the Leader: The Evolving Network of Charter School Giving

Abstract

Background/Context

Research on the patterns of philanthropic funding of charter schools has largely focused on the behavior of major foundations. This work has documented how the once diffuse giving by these major foundations has become increasingly concentrated on a small number of jurisdictional challengers in the form of charter schools, charter management organizations, and intermediary organizations.

Purpose

The current study examines whether this convergence in giving has spread to the entire network of foundations giving to charter-school-related organizations. We do so by extending current work and focus on the broader institutional field that includes the interactions between major foundations, smaller foundations, and grantees over time. Moreover, we look to see, if such a field-wide convergence is present, whether there is evidence consistent with the institutional process of isomorphism in which low-status foundations match the giving strategy of higher status ones.

Research Design

We test for these dynamics using exponential random graph models (ERGMs), a hypothesis-testing framework for network analysis. More specifically, we analyze the funding ties among 809 foundations that gave grants to California charter schools and charter-school-related organizations between 2003 and 2014, as available through the Foundation Directory Online. We constructed multiyear windows to examine funding ties between foundations and recipients, using organizational characteristics, such as foundation type, foundation year, professionalization, foundation size, organizational type, and location, and endogenous features of the network as independent variables.

Findings

Results indicate centralization of giving over time, as larger and newer foundations began practicing more targeted giving and the most connected recipients were involved in a disproportionate number of funding ties. We also found evidence consistent with institutionalization, as foundations with professional staffs played a larger role in giving, and smaller foundations increasingly engaged in behavior similar to their larger peers over time. Finally, we found evidence for the consistent effect of propinquity: We observe co-funding and co-receiving ties between foundations and grantees in geographical proximity to each other.

Conclusions

This work examines the network dynamics of charter school philanthropic giving and provides evidence for the centralization and institutionalization of the field. In turn, this may create inequity in funding for charter schools because it may be more difficult for smaller or less ideologically popular organizations to penetrate the field. Policy makers should be aware of these forces and should take them into account when making budgetary and funding decisions.