Altruistic and Joy-of-Giving Motivations in Charitable Behavior

Posted: 23 Apr 2002

See all articles by David Ribar

David Ribar

George Washington University - Department of Economics; IZA Institute of Labor Economics

Mark Wilhelm

Indiana University Purdue University Indianapolis (IUPUI) - Department of Economics

Abstract

This study theoretically and empirically examines altruistic and joy-of-giving motivations underlying contributions to charitable activities. The theoretical analysis shows that in an economy with an infinitely large number of donors, impurely altruistic preferences lead to either asymptotically zero or complete crowd-out. The paper then establishes conditions on preferences that are sufficient to yield zero crowd-out in the limit. These conditions are fairly weak and quite plausible. An empirical representation of the model is estimated using a new 1986-92 panel of donations and government funding from the United States to 125 international relief and development organizations. Besides directly linking sources of public and private support, the econometric analysis controls for unobserved institution-specific factors, institution-specific changes in leadership, year-to-year changes in need, and expenditures by related organizations. The estimates show little evidence of crowd-out from either direct public or related private sources. Thus, at the margin, donations to these organizations appear to be motivated solely by joy-of-giving preferences. In addition to addressing the basic question of motives behind charitable giving, the results help explain the existing disparity between econometric and experimental crowd-out estimates.

Suggested Citation

Ribar, David C. and Wilhelm, Mark, Altruistic and Joy-of-Giving Motivations in Charitable Behavior. Journal of Political Economy, Vol. 110, April 2002. Available at SSRN: https://ssrn.com/abstract=303312

David C. Ribar

George Washington University - Department of Economics ( email )

Monroe Hall, Suite 340
2115 G Street, NW
Washington, DC 20052 20052
United States
202-994-7608 (Phone)
202-994-6147 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Mark Wilhelm (Contact Author)

Indiana University Purdue University Indianapolis (IUPUI) - Department of Economics ( email )

425 University Boulevard
Indianapolis, IN 46202-5140
Germany
317-274-4756 (Phone)
317-274-2347 (Fax)

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