Limiting the Number of Charities

CORE Discussion Paper 2006/74

14 Pages Posted: 19 Nov 2006

See all articles by Pierre Pestieau

Pierre Pestieau

University of Liège - Research Center on Public and Population Economics; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); Catholic University of Louvain (UCL) - Center for Operations Research and Econometrics (CORE)

Motohiro Sato

Hitotsubashi University - Faculty of Economics

Date Written: September 2006

Abstract

We consider a model where creating a charity implies a fixed cost and individual contributions depend on how close donors feel with respect to the charity. In that setting we show that there are an optimal number of charities and an optimal rate of subsidization that depend on the set-up cost and on the attachment of donors to charities that share the same values as theirs. We also consider the case of free-entry and compare it with the second-best solution controlling for the number of charities.

Keywords: charities, joy of giving

JEL Classification: L31, H41

Suggested Citation

Pestieau, Pierre and Sato, Motohiro, Limiting the Number of Charities (September 2006). CORE Discussion Paper 2006/74, Available at SSRN: https://ssrn.com/abstract=945080 or http://dx.doi.org/10.2139/ssrn.945080

Pierre Pestieau (Contact Author)

University of Liège - Research Center on Public and Population Economics ( email )

Boulevard du Rectorat, 7, Batiment 31
Sart-Tilman
B-4000 Liege, 4000
Belgium
+32 4 366 3108 (Phone)
+32 4 366 3106 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

Catholic University of Louvain (UCL) - Center for Operations Research and Econometrics (CORE) ( email )

34 Vopie Roman Pays
Louvain la Neuve
Belgium

Motohiro Sato

Hitotsubashi University - Faculty of Economics ( email )

Tokyo, 186-8601
Japan

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
98
Abstract Views
801
rank
306,527
PlumX Metrics