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American Economic Journal: Economic Policy: Vol. 2 No. 1 (February 2010)

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Time Is Money: Choosing between Charitable Activities

Article Citation

Feldman, Naomi E. 2010. "Time Is Money: Choosing between Charitable Activities." American Economic Journal: Economic Policy, 2(1): 103-30.

DOI: 10.1257/pol.2.1.103

Abstract

This paper analyzes the impact of a preferential tax-price for monetary donations on the joint decision to donate time (volunteer) and money. The methodological approach takes into account that consumption of each charitable good affects consumption of the other. Using data from a national survey on household charitable giving, the results show that donations of time and money are substitutes. However, a decrease in the tax-price of monetary donations also has a positive effect on donations of time that acts outside the change in relative prices. This more than offsets the substitution effect leading to an overall positive correlation between the two charitable goods. (JEL D64, H24, H31)

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Authors

Feldman, Naomi E. (Ben-Gurion U Negev)

JEL Classifications

D64: Altruism
H24: Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
H31: Fiscal Policies and Behavior of Economic Agents: Household

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