Demand for charity donations in private non-profit markets: The case of the U.K

Abstract This paper presents estimates of the demand for donations for U.K. charities in 1985. These estimates make demand depend upon price, fund-raising expenditure, a quality index, and alternative revenue sources. The price elasticity of donations found here shows, for the most part, an elastic response and is consistent with previous studies using U.S. data. Our empirical results suggest that non-profits in the U.K., unlike their counterparts in the U.S., are net revenue maximisers . We discovered no significant evidence that public donations crowded out private donations in our sample of 300 charities.

[1]  H. Hansmann,et al.  The Role of Nonprofit Enterprise , 1980 .

[2]  THE NONPROFIT FIRM: A POTENTIAL SOLUTION TO INHERENT MARKET FAILURES , 1988 .

[3]  Todd Sandler,et al.  EASY RIDERS, JOINT PRODUCTION, AND PUBLIC GOODS* , 1984 .

[4]  Susan Rose-Ackerman,et al.  Charitable Giving and “Excessive” Fundraising , 1982 .

[5]  Peter Warr,et al.  The private provision of a public good is independent of the distribution of income , 1983 .

[6]  J. Andreoni.  Privately provided public goods in a large economy: The limits of altruism , 1988 .

[7]  Burton A. Weisbrod,et al.  Volunteer labor supply , 1987 .

[8]  B. Weisbrod,et al.  Demand for Collective Goods in Private Nonprofit Markets: Can Fundraising Expenditures Help Overcome Free-Rider Behavior? , 1986 .

[9]  Russell D. Roberts,et al.  A Positive Model of Private Charity and Public Transfers , 1984, Journal of Political Economy.

[10]  C. Clotfelter.  Tax incentives and charitable giving: evidence from a panel of taxpayers , 1980 .

[11]  H. Varian,et al.  On the private provision of public goods , 1986 .

[12]  T. Sandler,et al.  Joint Supply and the Finance of Charitable Activity , 1986 .

[13]  A Theory of Non-Profit Firms , 1983 .

[14]  B. Abrams,et al.  The ‘crowding-out’ effect of governmental transfers on private charitable contributions , 1978 .

[15]  Peter Warr,et al.  Pareto optimal redistribution and private charity , 1982 .

[16]  R. Steinberg,et al.  Voluntary Donations and Public Expenditures in a Federal System , 1987 .