Does Government Spending Crowd Out Donations of Time and Money?

Abstract

The authors examine data on giving and volunteering to determine whether public provision of social services and other public goods affects donations of time and money and provides evidence of crowding out. They find a negative and statistically significant relationship between government spending and donations of money and time. They also find that volunteers have demographic and other characteristics that are associated with high values of time and money.

Generosity and Philanthropy: A Literature Review

“…In South Africa, Christians are more likely to engage in philanthropy than non-Christians or the non-religious (Everatt et al 2005). Simmons and Emanuele (2004) find that people brought up in a religious household are larger donors, though this study did not contain a measure of current religiosity. Regnerus, Smith and Sikkink (1998) find that the importance of religion in one's family of origin is not positively related to donating to organizations that help the poor and the needy once current church attendance and importance of religious faith are controlled.…”

“…Feldstein and Clotfelter (1976) find higher donations in mid-sized cities (250,000-1,000,000) than in both smaller and larger towns. Likewise, Simmons and Emanuele (2004) find higher donations by those living in suburbs rather than in the country. In Indonesia, urban residents give more often and higher amounts (Okten & Osili 2004).…”

On time and money donations

“…In a similar vein, Day and Devlin (1996) find a crowding-in effect of government expenditure also for volunteering. Considering both time and money donations, Simmons and Emanuele (2004) conclude instead that there exists a crowding-out effect, but its impact is only minimal. On the other hand, many authors have considered the impact of tax deductibility on money donations, by calculating the elasticity to their tax price.…”

Charity Starts … at Work? Conceptual Foundations for Research with Businesses that Donate to Food Redistribution Organisations

“…It shows that the majority of donations occur as a response to a solicitation, and that the way the potential donors are solicited determines whether the solicitation is effective [38]. Much of this research has explored the impact of the number of solicitations businesses receive [49][50][51], the causes of "donor fatigue" [52], and the effectiveness of direct (a personal request) vs. indirect (a letter) solicitation [38]. Examining the various ways that food redistribution organisations approach and solicit food businesses to donate their surplus food will be interesting to determine whether solicitations for surplus food differ to solicitations for money.…”