This article is an empirical examination of the government failure theory using a cross-country data set. The government failure theory is represented in the major existing literature as providing a sound explanatory basis for an interesting characteristic of the nonprofit sector, that is, there is a large variability in nonprofit sector size from one place to another. Salamon et al. (Social origins of civil society: An overview, Working Papers of the Johns Hopkins Comparative Nonprofit Sector Project, 2000) examined this theory using the Johns Hopkins Comparative Nonprofit Sector Project (CNP) data set, and consequently rejected the government failure theory. However, by applying the panel analysis approach to the CNP data set, this article shows that the government failure theory should not have been so easily rejected.Keywords The size of the nonprofit sector Á The government failure theory Á Demand heterogeneity Á A fixed effects model Á A pooling model Résumé Cette étude est un examen empirique de la théorie de la défaillance des É tats réalisé à l'aide d'un ensemble de données transnationales. La théorie de la défaillance des É tats est représentée dans les principales publications actuellement disponibles comme fournissant une base sérieuse pour expliquer l'une des Y. Matsunaga (

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