Look who's crowding-out!
Correlates of willingness to substitute
declining government contributions
to charitable organizations
René Bekkers
Arjen de Wit
Center for Philanthropic Studies
VU University Amsterdam
11th ISTR Conference
Münster, Germany
July 22, 2014
Crowding-out or crowding-in?
Three questions
1. How is the Dutch population responding to
reductions in government support for
nonprofit organizations?
2. How do responses to reductions in
government support vary between causes
and individual citizens?
3. Which mechanisms determine these
responses?
What does previous research tell us?



Arjen de Wit conducted a systematic
literature review and meta-analysis of
‘crowding-out’ studies.
Effect sizes published in previous research
were analyzed and related to study
characteristics.
Effect sizes vary strongly between studies
with sample composition and methods used.
A snapshot of estimates
A variety of findings



Median effect size: -.17 = weak crowding out.
Analyses of tax records and lab experiments
produce more crowding out than surveys
and field experiments.
US studies find more crowding-out (-.23)
than studies from Europe, which even find
very weak crowding-in (.07).
The Civic Voluntarism Model
Resources
Change in
contribution
Engagement
Recruitment
Based on Verba, S., Schlozman, K.L. & Brady, H.E. (1995).
Voice and Equality: Civic Voluntarism in American
Politics. Cambridge: Harvard University Press.
Eight Mechanisms
People give more when:
1.
They perceive a need
need
2.
They are asked to give
solicitation
3.
Costs are lower, benefits higher
costs/benefits
4. People care about the recipients altruism
5.
Giving is rewarded socially
reputation
6. Giving reinforces their self-image self-rewards
7.
Causes match their values
values
8. Gifts are seen as more effective
efficacy
Bekkers, R. & Wiepking, P. (2011). ‘A Literature Review of Empirical
Studies of Philanthropy: Eight Mechanisms that Drive Charitable
Giving’. Nonprofit and Voluntary Sector Quarterly, 40(5): 924-973.
Our first question
1. How is the Dutch population responding to
reductions in government support for
nonprofit organizations?
2. How do responses to reductions in
government support vary between causes
and individual citizens?
3. Which mechanisms determine these
responses?
The scenario experiment
• In the Giving in the Netherlands Panel
Survey 2012 we included a scenario
experiment.
• 1,448 participants evaluated 3 scenarios,
constructed randomly by combining
information on hypothetical budget cut
levels and sectors.
• Participants were reminded of their
households’ contribution in the past year.
Example of scenario
“With your household you donated €100 to
health in the past year. If the government
cuts 5% in this area, how would you react?”
Response categories:
• I will give the same as last year
• I am willing to give more
• I will also give less
[if more/less] What will be the new
amount?
How the Dutch respond to cutbacks
Average response across all
4,344 scenarios
Our second question
1. How is the Dutch population responding to
reductions in government support for
nonprofit organizations?
2. How do responses to reductions in
government support vary between causes
and individual citizens?
3. Which mechanisms determine these
responses?
Responses vary by sector
Our third question
1. How is the Dutch population responding to
reductions in government support for
nonprofit organizations?
2. How do responses to reductions in
government support vary between causes
and individual citizens?
3. Which mechanisms determine these
responses?
Resources, recruitment, engagement
2.8
2.6
2.4
2.2
2
1.8
1.6
1.4
1.2
1
0.8
Higher education
Top income quintile
>3 solicitations in
past two weeks
Amount donated in
past year (ln)
Resources
Recruitment
Engagement
Odds ratios from logistic regression of willingness to contribute more after
government cutback in at least one scenario (GINPS12, n=1,478; including controls for
gender, age, income from wealth, home ownership, number of donation areas)
Values, reputation and efficacy
2
1.8
1.6
1.4
Neither sizeable
nor significant
1.2
1
0.8
Principle of Joy of giving Perception of Knowledge
care
need
about need
test
Values
Need
Social
pressure
Reputation
High
High
charitable confidence in
confidence government
Efficacy
Odds ratios from logistic regression of willingness to contribute more after
government cutback in at least one scenario (GINPS12, n=1,478)
Our three answers
1. In the aggregate, the Dutch population is not
changing donation behavior in response to
reductions in government support for nonprofit
organizations.
2. However, responses vary strongly between
causes and individual citizens.
3. The key mechanisms determining these
responses are prosocial values, solicitation,
reputation, and efficacy.
Specifically
• Those with more resources, receiving more
solicitations and more generous donors are more
likely to contribute more after government
cutbacks.
• Those with a higher principle of care, more
positive social norms on giving and charitable
confidence are more likely to crowd-out.
• The principle of care is the only characteristic
predicting the level of crowding-out.
More headlines
VAST MAJORITY NOT RESPONSIVE TO
CHANGES IN GOVERNMENT SUBSIDY
Resources influence willingness to
contribute through engagement, not
recruitment
Severity of budget cuts not related to the willingness to increase donations
Committed donors most
willing to increase
donations
Contact details
• René Bekkers, [email protected] and Arjen
de Wit, [email protected]
• ‘Giving in the Netherlands’, Center for
Philanthropic Studies, Faculty of Social
Sciences, VU University Amsterdam,
www.giving.nl
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slides - Rene Bekkers