Philanthropy in a Secular Society
52 Pages Posted: 12 Apr 2016
Date Written: February 2016
In this study we investigate the relationship between religious and charitable giving. We test how income, the tax-price of giving and the German church tax, differently affect charitable donations of church members, individuals leaving church and non-church members. We find crowding in between the church tax and charitable giving for church members, but not for the church-leavers. In contrast to church members, donations of church-leavers and non-members are also highly responsive to the tax deductibility. Additionally, non-donors exhibit a significantly increased probability of leaving church compared to donors. Finally, we demonstrate that leaving church increases donations on the extensive margin but decrease giving along the intensive margin.
Keywords: Charitable giving, secularization, church tax, Germany, fixed-effects poisson model
JEL Classification: H24, H41, Z12
Suggested Citation: Suggested Citation