European
Perspectives
on
Philanthropy
René Bekkers
VU University Amsterdam
The Netherlands
Understanding Philanthropy
Conference
University of Kent
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Wall Street
is an early example
of Dutch Philanthropy.
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Stuyvesant called upon the 43 richest residents of New Amsterdam to
provide funding to fix up the ailing Fort Amsterdam and to construct a
stockade across the island to prevent attacks from the north, while it took
New Amsterdam's most oppressed inhabitants -- slave labor from the Dutch
West India Company -- to actually build the wall.
Russell Shorto – The Island at the Center of the World
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This is the ‘Giving house’
in the city of
‘s-Hertogenbosch. In the
middle ages, the poor in
the city received food
and clothing at this
house. Funds for the
service were obtained
through bequests,
legacies and other
donations from citizens,
but also from the city
council.
Today, the building
serves as the city’s library
and an arts center.
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The ‘Sweet Mary’ Fraternity was
founded in 1318. Its first
members were clergy. The
fraternity engaged in charity and
cultural activities. Ghisbertus
van der Poorten donated his
house in 1483. The acceptance of
Protestants, including members
of the Royal House of Orange,
helped resolve religious conflicts
that had dominated the city
since the Spanish occupation in
the 17th century. The current
building in neogothic style dates
back to 1846.
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The ‘Sweet Mary’ Fraternity was
founded in 1318. Its first
members were clergy. The
fraternity engaged in charity and
cultural activities. Ghisbertus
van der Poorten donated his
house in 1483. The acceptance of
Protestants, including members
of the Royal House of Orange,
helped resolve religious conflicts
that had dominated the city
since the Spanish occupation in
the 17th century. The current
building in neogothic style dates
back to 1846.
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Amsterdam Concert Hall
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Amsterdam Concert Hall
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The Rijksmuseum (1885)
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1880: VU University founded
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Willem Hovy (1840-1915),
owner of brewery The Crowned
Falcon, donated 25.000
guilders for the foundation of
the ‘Vrije Universiteit’.
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This is all history.
We have ‘lost’ the philanthropic tradition.
Since World War II, state subsidies
dominate funding for nonprofit
organizations.
Philanthropy is in our culture – but
institutions have discouraged it.
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The Societal Significance of Philanthropy
1. The societal destination of philanthropy
How much time and money do citizens
in Europe contribute to which causes?
2. Social origins
Who gives what and why?
3. The societal impact of philanthropy
What does philanthropy achieve?
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If only we knew…
1. How much time and money?
We do not know.
2. How many people give and volunteer?
It depends on the data;
‘methodology is destiny’.
3. What does philanthropy achieve?
We do not know - it depends on
many societal conditions.
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Data from the Gallup World Poll. Map available at
http://www.targetmap.com/viewer.aspx?reportId=42492
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Research Questions
for ‘Giving Europe’
Which is the most generous country
in Europe and why?
1. How large are differences in philanthropy
(incidence, amounts, causes supported)
between nations in Europe?
2. How can these differences be explained?
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Giving Prevalence in Europe
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
GR HU PT ES FR CZ IT PL BE FI DE AT SE LU DK IE NL GB
European Social Survey
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Eurobarometer
Understanding Philanthropy Conference
Gallup World Poll
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Why may countries differ?
A. Because of population composition
differences: some countries are populated
with more generous citizens.
(Who gives?)
B. Because of country differences: some
countries make citizens living there more
generous.
(When do people give?)
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‘Theories’: clusters of variables
• Political: ‘Worlds of Welfare Capitalism’,
democracy, civic engagement, inequality
• Economic: ‘Crowding-out’, price of giving,
wealth
• Cultural: religious traditions, social norms
• Legal: freedom for nonprofit organizations
• Psychological: trust, guilt, perceived need
• Communication: news consumption
• Biological: DNA, signalling, nutrition
• Thermoclimatic: adversity in weather
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‘Theories’: clusters of variables
• Economic: ‘Crowding-out’, price of giving, the
wealth of nations
• Political: ‘Worlds of Welfare Capitalism’,
democracy, civic engagement, inequality
• Cultural: religious traditions, social norms
• Legal: freedom for nonprofit organizations
• Psychological: trust, guilt, perceived need
• Communication: news consumption
• Biological: DNA, signalling, nutrition
• Thermoclimatic: adversity in weather
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Mechanisms driving philanthropy
1.
2.
3.
4.
5.
6.
7.
8.
Awareness of need
Being asked to give
Costs and benefits
Altruism: how much others are giving
Reputation: social pressure and rewards
Psychological costs and rewards
Values
Efficacy
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Why do people give?
People give more (often) when
1. There is a clear need
2. They are being asked
3. Costs are lower, and benefits are higher
4. They care about the recipients
5. They receive social benefits
6. They receive psychological benefits
7. The cause matches their values
8. Donations are perceived to be efficient
need
solicitation
costs/benefits
altruism
reputation
self-rewards
values
efficacy
Source: 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. Available at www.understandingphilanthropy.com
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Not today
• How much are monozygotic twins alike
with respect to their giving?
• Why do people prefer charities with names
similar to their own names?
• Why do men and women give differently?
• How is political affiliation related to giving?
• How much altruism is there in individual
giving decisions?
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Mechanisms driving philanthropy
1.
2.
3.
4.
5.
6.
7.
8.
Awareness of need
Being asked to give
Costs and benefits
Altruism: how much others are giving
Reputation: social pressure and rewards
Psychological costs and rewards
Values
Efficacy
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The ‘Crowding-out Effect’
• Occurs when a decrease in government
funding leads to an increase in
philanthropic funding for a cause.
• Or vice versa, when an increase in
philanthropy reduces government funding.
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The Big Society / Participation State
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The ‘Waterbed Effect’
Private donations
Government grants
Friedman (1962) called this the
crowding-out effect.
The metaphor assumes the water mass is
constant & contained, as if philanthropy and
government funding are a ‘zero-sum game’.
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Questioning the metaphor
• The metaphor is not born out of research.
• For a researcher, it is a testable hypothesis.
• Empirical tests may as well reveal the
reverse effect of ‘crowding-in’: when an
increase in government funding increases
philanthropic activity.
• The research question is: when and where
occurs how much crowding-out?
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UK studies
A meta-analysis
Crowding-out 
 Crowding-in
De Wit, A. & Bekkers, R. (2014). Government support and charitable donations: A meta-analysis of the crowding-out
hypothesis. Paper presented at the 43d ARNOVA Conference, Denver, November 20-22, 2014.
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‘A severe cut in government funding to
nonprofit organisations is not likely, on
average, to be made up by donations from
private donors.’
Abigail Payne (1998)
Across all the published studies, a $1
increase in government support is
associated with a $0.18 decrease in private
charitable donations on average.
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Contingencies
US-based studies tend to find more crowdingout than studies from elsewhere, including
Europe.
Experiments in controlled environments
(mostly with students) find more crowdingout than studies analyzing archival data from
nonprofit organizations.
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The ‘crowding-out effect’ varies
Between
• World regions and societies (macro-level)
• Organizations (meso-level)
• Citizens (micro-level)
• These three levels, and over time.
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It’s not as simple as rocket science
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Data from the Gallup World Poll show that citizens in
countries in which the tax burden is higher are more
likely to give to charity, suggesting a crowding-in effect
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Outside Europe, there is no relationship between
tax burden and the prevalence of giving
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N = 111,
r = .011
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EU investments in innovation
• In the European Foundations for Research
and Innovation (EUFORI) Study, a
consortium of 34 national experts
documented ~12,000 foundations
supporting R&I in Europe.
• In which countries are foundations most
active?
• How do foundations view their relationship
with government?
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N = 28
r = - .176
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 Remarkably similar to the average ‘crowding-out effect’
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Country characteristics
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Countries above the diagonal rank higher in corporate
investments than in foundation spending on R&I
N = 27
r = 0.567
A strongly
positive
relation
The UK is one of the countries that rank higher in
foundation than corporate spending on R&I
Scandinavia wins
(again)
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Flexibility is the rule
• The ‘crowding-out’ effect is flexible, open to
modification – and may even become a
crowding-in effect.
• Governments, nonprofit organizations,
philanthropists and the public at large can
influence it.
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Source: Gouwenberg et al., (2015). EUFORI Study
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Four models of collaboration
• Competitive: try to do better than
government or make government do better
• Initiating: start a program, and export it
into government policy
• Substituting: take over government tasks
• Complementary: work towards similar goals
and strengthen each other as partners
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Source: Gouwenberg et al., (2015). EUFORI Study
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Recreating a ‘Giving Culture’
• Overcome the modesty: “Do not let your left
hand know what your right hand is doing”
(Matthew 6:3).
• Develop new forms of philanthropy, mixed
with business.
• Education could play a role in creating a
giving culture, e.g. through service learning.
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The stubborn 2% in the UK: giving as a % of GDP doesn’t change much
Source: Perry (2013), https://philanthropy.com/article/The-Stubborn-2-Giving-Rate/154691
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The expanding pie in the UK: giving as a % of expenditure increased
Source: Cowley, McKenzie, Pharoah & Smith (2011)
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The changing pie in the Netherlands: giving as a % of expenditure
Sources: Schuyt, Gouwenberg & Bekkers, Giving in the Netherlands,
https://renebekkers.files.wordpress.com/2015/06/15_06_29_economic_trends_philanthropy.xlsx
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Popular concerns
• Under- or loss of coverage: the general level
of service provision may suffer when the
government retreats.
• Inequality: philanthropy may fund specific
causes, but not others; Matthew-effects will
help those causes with an early advantage.
• ‘Too much’ influence on public policy for
philanthropists leading to arbitrariness,
nepotism and inequality.
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Giving USA
4
3 1
religion
5
education
31
10
human services
foundations
public-society benefit
health
7
arts, culture, humanities
international
11
environment/animals
16
unallocated
12
Total giving, 2013: $335 billion (2.0% GDP; tax burden: 25%)
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Giving in the Netherlands
religion
13
education
22
[human services]
7
[foundations]
public-society benefit and human services
8
5
health
arts, culture, humanities
international
13
13
environment/animals
unallocated
6
12
sports and recreation
Total giving, 2013: €4.4 billion (0.8% GDP; tax burden: 38%)
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What we need is…
• A serious political discussion about the role
of philanthropy in public policy.
• Decent research informing policy decisions,
paying attention to undesirable side-effects.
• An Impact Philanthropy Lab (IPL): creation
and evaluation of new philanthropic /
business investment instruments.
• Knowledge about what works in
fundraising, and about failures.
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Unpublished?
Published
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These did not work.
• Picture recipients on fundraising letters (-€40k).
• Calling alumni by current fraternity members.
• Reminding people of an event that made them
feel grateful.
• Reminding people of an event that made them
feel happy.
• Giving people more positive social information.
• Giving students the names of charity
ambassadors.
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Published - Unpublished
• Picture recipients on fundraising letters (-€40k).
• Calling alumni by current fraternity members.
• Reminding people of an event that made them
feel grateful.
• Reminding people of an event that made them
feel happy.
• Giving people more positive social information.
• Giving students the names of charity
ambassadors.
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These did not work either.
•
•
•
•
•
Reducing the anonymity of donations.
Giving the option of forfeiting anonymity.
Switching the default from ‘giving’ to ‘keeping’.
Telling people they are a helpful person.
Telling people the government lowered its subsidy,
increasing the need for donations.
• Showing students stylized eyespots.
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% donating
But real watching eyes….
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
7
17
18
24
18
60
61
19
74
base
donated 0
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61
Suggesting a €35 contribution
120
Frequency
100
80
60
40
20
0
<10
10
15
20
25
no reference
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35
40
45
50
>50
reference €35
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Framing the incentive as a match
35%
+90%
30%
+46%
25%
20%
15%
10%
5%
0%
control group
50% rebate:
price = 0,50
100% match:
price = 0,50
Proportion of the reward for participation in GINPS04 donated by participants
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And finally.
Good food….
And a drink.
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From my Blog, https://renebekkers.wordpress.com/2014/12/17/the-fishy-business-of-philanthropy/
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80
Lithuania
Ukraine
Rank of proportion of population engaging in charity
Russia
70
Greece
BelarusEstonia
China
Portugal
60
Georgia
Turkey Serbia
Romania
India South Africa
VietnamLatvia
Moldova
Japan
50
Peru
Egypt
MontenegroBulgaria
Venezuela
Argentina
Ghana
Croatia
Nigeria
30
France
Malaysia
Finland
Norway
20
Iceland
10
0
0
10
NOTE: a higher rank is closer
to the origin but means more
fish and more giving
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Turkmenistan
Tajikistan
Algeria
Hungary
Colombia
Spain
Philippines
40
Armenia
Kyrgyz Republic
Kazakhstan
Belgium
Pakistan
Azerbaijan
Uzbekistan
MexicoBrazil
Slovakia
Albania
Bosnia and Herzegovina
Kenya
Czech Republic
Slovenia Iran
Macedonia
Poland
Indonesia
Chile
Germany
Israel
Sweden
Italy CanadaUnited States
New ZealandDenmark
Austria
Australia
Switzerland
Morocco
Ireland United Kingdom
Thailand
Netherlands
Malta
Mongolia
y = 0.298x + 27.379
R² = 0.0888
r = 0,298
20
30
40
50
60
Rank of country per capita fish consumption in kg
70
80
Sources: http://www.helgilibrary.com/indicators/index/fish-consumption-per-capita and
http://www.theguardian.com/news/datablog/2010/sep/08/charitable-giving-country#data
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Grams of food required to yield an
additional €1 donation
2000
1800
1600
1400
1200
1000
800
600
400
200
0
spinach chicken
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eggs
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milk
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References
•
•
•
•
•
•
Bekkers, R. (2015). The Analysis of Regional Differences in Philanthropy: Evidence from the
European Social Survey, the Eurobarometer and the Giving in the Netherlands Panel Survey. Paper
presented at the 5th ESS Workshop, The Hague, May 22, 2015.
https://renebekkers.files.wordpress.com/2011/10/15_05_22_ess_regional_differences.pdf
Bekkers, R. (2015). ‘Regional Differences in Philanthropy’. In: Routledge Companion to Philanthropy,
edited by J. Harrow, T. Jung & S. Phillips. Routledge.
Bekkers, R. (2015). When and Why Matches are More Effective Subsidies Than Rebates. Research in
Experimental Economics, Volume 18: Replication in Economic Experiments. Edited by Deck, C. Fatas,
E., & Rosenblat, T. Emerald Group Publishing.
Gouwenberg, B., Karamat Ali, D., Hoolwerf, B., Bekkers, R., Schuyt, T. & Smit, J. (2015). Synthesis
Report EUFORI Study: European Foundations for Research and Innovation. Luxembourg:
Publications Office of the European Union.
Bekkers, R. (2014). The Fishy Business of Philanthropy. December 17, 2014.
https://renebekkers.wordpress.com/2014/12/17/the-fishy-business-of-philanthropy/
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.
http://understandingphilanthropy.com
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Thanks, says
René Bekkers
Professor & Director
Center for Philanthropic Studies
VU University Amsterdam
r.bekkers@vu.nl
Twitter: @renebekkers
Blog: renebekkers.wordpress.com
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