Voluntary Giving and Economic Growth: Time Series Evidence for the US

31 Pages Posted: 22 Oct 2010

See all articles by Friedrich Heinemann

Friedrich Heinemann

ZEW – Leibniz Centre for European Economic Research; University of Heidelberg - Alfred Weber Institute for Economics

Date Written: 2010

Abstract

This study analyzes the sensitivity of US giving to both business cycle fluctuations and trend growth. With tax revenues as a point of reference, US giving constitutes a relatively stable source of revenue. Total giving is characterized by a business cycle volatility which is comparable to the moderate one of indirect taxes. However, this overall finding is composed of the respective sub-components’ very different short-run GDP-elasticities. Individual and, to an even larger extent, corporate giving is quite sensitive to cyclical fluctuations. By contrast, foundation giving and charitable bequests tend to stabilize total giving over the business cycle. The macro estimates for the income elasticities lie in the upper band of the well researched micro-estimates. This is consistent with a social multiplier view according to which individual giving is mutually reinforcing.

Keywords: Charitable giving, social multiplier, error-correction-model

JEL Classification: H27, H41, C22

Suggested Citation

Heinemann, Friedrich, Voluntary Giving and Economic Growth: Time Series Evidence for the US (2010). ZEW - Centre for European Economic Research Discussion Paper No. 10-075, Available at SSRN: https://ssrn.com/abstract=1695417 or http://dx.doi.org/10.2139/ssrn.1695417

Friedrich Heinemann (Contact Author)

ZEW – Leibniz Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 7,1
D-68034 Mannheim, 68034
Germany

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

University of Heidelberg - Alfred Weber Institute for Economics ( email )

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Heidelberg, D-69117
Germany

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