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
