The non profit sector as a foundation for the interaction among the social economy, the public sector and the market

In this chapter we illustrate how the public sector might fail in narrowing spatial inequalities, and how both underdeveloped markets and urgent territorial needs create in peripheral areas robust individual incentives to turn into non-profit activities or even household production. In all those situations, a well-developed non-profit sector can offer marginalized or excluded social groups a legal and ethical opportunity to obtain a decent income by offering rewards (monetary or nonmonetary) in exchange for volunteering, allowing households to afford the cost of living. Laying on the results of the analysis, we discuss four cases of successful cooperation among SSE institutions by one side, and the private and the public sector on the other. In all those cases, the private and the public sector decided to facilitate the development of the non-profit sector by contracting out part of the production process to reduce costs and achieve a higher level of effectiveness. The result was successful because the non-profit sector did not incur in the opportunistic behaviors that might affect profit-oriented activities. Therefore, we suggest how local inter-institutional cooperation among the SSE, the private and the public sector should become the norm rather than the exception, in order to achieve at the same time a higher level of equitable and sustainable development and well-being.