Olsen’s entire career was built on one critical insight: that a group with a common interest will not organize unless it is in the individual interests of prospective leaders and members.
Sounds obvious, doesn’t it? Well, it wasn’t in 1965 when a young Olsen made this argument in his path-breaking The Logic of Collective Action. In the post-World War II period, political science was caught up in a heady enthusiasm for creating a more just political order through new sorts of institutions that would represent the interests of all the various different groups in society. This so-called behavioralist political science, led by political scientists such as David Easton, assumed that whenever a group of people has an interest in common (such as good working conditions or the promotion of free trade) it will organize in pursuit of that common interest.
It follows that every important interest in society has an organization to represent it. Some behavioralist political scientists proposed that legislatures with representatives from geographic districts -- like the U.S. Congress -- should be replaced by legislatures with representatives from all the major organizations in society (unions, trade associations, farmers’ cooperatives, and the like).
Olsen replied that it is nonsense to suppose that every group with a common interest will organize to advance this interest. Every organization needs leaders, and members must be induced to lend their support to an organization. It must be in someone’s individual interest to organize the group, and the leader must be able to offer a sufficient inducement to other individuals to give their time, money, and support to the new organization. Without leadership and an organized membership, the group remains merely a “latent group" -- an unorganized mass with a common interest but no vehicle for the expression of that interest.
Olsen supposed that many important interests remained unrepresented by formal groups because the conditions for organizing had not yet been satisfied. Thus, the behavioralist assumptions that (1) whenever a group of people has a common interest the group will organize in pursuit of that interest and (2) therefore that the sum of all organized groups represents the sum of all interests in society were deeply flawed. (The claim that a large group may go unrepresented is today asserted by the Occupy movement, which claims to represent “the 99 percent,” and was asserted in the 1970s by Jerry Falwell’s “Moral Majority,” whose very name asserted that it represented a hitherto-ignored majority group.)
Olsen described how latent groups become successfully organized groups. The keys, no one familiar with nonprofits will be surprised to learn, are entrepreneurial leadership and what Olsen termed “selective incentives.” Selective incentives are private goods offered exclusively to those who commit themselves to membership in the group. They may be as varied as a calendar of nature photos offered to members of a conservation group, discounts on auto insurance offered to members of a college alumni group, and the chance to play polo with Prince William offered to those who make $100,000 contributions to the prince’s charity. In any case, it is appeals to individual interest that makes for the resources to pursue a common group interest.
Olsen was one of those scholars whose first book contains his deepest insight. The rest of Olsen’s distinguished career was built upon his youthful insight about the importance of appeals to individual interests and the role of groups in political life: for example, in The Rise and Decline of Nations: Economic Growth, Stagflation, and Social Rigidities (1984), Olsen argued that young countries benefit as groups organize to advance various social interests. This echoed Alexis de Tocqueville’s arguments about the role of civil associations in the young United States. But in a twist Tocqueville didn’t anticipate, Olsen argued that over many decades the proliferation of groups, especially lobbying groups, gradually clogs political and economic exchange, leading to political and economic gridlock.
Olsen’s Logic of Collective Action, nearly fifty years after its publication, remains in print and retains the fresh energy that comes from the sense that he was demolishing shibboleths. This short book (not much more than 150 pages) has an important place in the intellectual history of the social sciences in the last half century and offers insights about how nonprofits and other groups successfully organize even today.