A groundbreaking study by Shuyi Deng, an assistant professor at the Paul H. O’Neill School of Public and Environmental Affairs, reveals that racial disparities in nonprofit funding are more complex and hierarchical than previously understood.
Published in Nonprofit and Voluntary Sector Quarterly, the article, “Intra-Group and Inter-Group Racial Disparities in Nonprofit Funding: Insights from Stratification Economics,” is the first of its kind to apply the framework of stratification economics to the nonprofit sector.
“In conversations with nonprofits, some organizations described long-standing competition with other BIPOC-serving nonprofits for a limited pool of funding intended to support BIPOC communities,” Deng said. “That observation pushed me to look beyond the White–BIPOC dichotomy and ask a different question: how do disparities operate within BIPOC communities, and what do those patterns mean for equity in nonprofit funding overall?”
Although the 2020 murder of George Floyd sparked a surge in research regarding funding gaps between White-led and Black, Indigenous, and People of Color (BIPOC)-led organizations, Deng’s research is the first systematic examination to look beyond the White-BIPOC binary, investigating disparities within BIPOC subgroups themselves.
Using a comprehensive national dataset of human services general support grants from 2018-22, the study shows that racial disparities in nonprofit funding exist not only between White and BIPOC communities—as well documented in existing literature—but also among different BIPOC subgroups. By applying the lens of stratification economics, the research illustrates how these internal disparities are not isolated incidents; rather, they serve to sustain or even exacerbate the broader White-BIPOC disparity.
Because intra-BIPOC disparities reinforce larger systemic gaps, the study concludes that current philanthropic models are effectively perpetuating racial hierarchies. These results underscore the urgent need for philanthropic actions that address the nuanced group dynamics both within and beyond BIPOC communities to ensure a more equitable distribution of resources.
“What stood out most was seeing evidence that these intra-BIPOC disparities can help sustain or even worsen the larger White–BIPOC funding gap,” Deng said. “Theoretically, that pattern fits the expectations drawn from stratification economics, but it is often hidden in how nonprofit data are collected and analyzed.
“My hope is that this aspect is surprising to practitioners, especially funders, and that it prompts a more nuanced approach to equity: one that recognizes differences among BIPOC communities and avoids funding practices that unintentionally intensify competition and unequal outcomes.”
Deng plans to use the findings to develop strategies for funders to allocate resources more equitably across BIPOC communities and strategies for nonprofits serving BIPOC communities to reduce the harms associated with intra-group competition and resource scarcity.