The Impact of Public Funding on the Different Types of Private Contributions
Forthcoming, Financial Accountability & Management
Posted: 30 Jul 2019
Date Written: May 2, 2019
We analyze the effect of public funding on private contributions to 67 non-governmental development organizations (NGDOs) in Spain from 2006 to 2011. Previous literature gives theoretical explanations for both the crowding-in and the crowding-out effects, while the empirical evidence presents different realities. In this study, we find a partial crowding-out effect (€1.00 of public funding reduces private contributions by €0.43) by using generalized method of moments estimators. However, this overall effect does not hold when analyzing the influence that different sources of public funds have on each type of private contribution.
Keywords: crowding-out, crowding-in, public funding, private contributions, nonprofit organizations
JEL Classification: M4, L31
Suggested Citation: Suggested Citation