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Description
Abstract Using data from the 2001 Giving and Volunteering in the United States survey, I examine household charitable donations to environmental organizations. Household income has a positive impact on environmental giving. While the tax price affects overall charitable contributions, it does not affect environmental giving. More education, being female, homeownership, and voting are also associated with a greater likelihood of contributing to the environment. African-Americans and Latinos are less likely to contribute to the environment, although conditional on giving, Latinos give more. Retired persons and households with children are less likely to contribute to the environment. Larger households give less to the environment. Households from the Northeast are the most likely to make environmental contributions while households from the South are the least likely.
Keywords Charitable donations * Demand for environmental quality * Environmental giving
JEL Classification Q50
Introduction
In this paper, using national data from the Giving and Volunteering in the United States survey, I examine household charitable donations to environmental organizations. (1) I examine both the characteristics of environmental donors and how the amount of environmental contributions varies by household characteristics. While economists have previously examined charitable donations behavior, often to estimate income and price elasticities, this study is the first to focus on donations to environmental organizations with national household data. (2) Private donations offer an opportunity to observe people spending on environmental quality rather than on other goods or services. These households are demonstrating a positive marginal willingness to pay for environmental quality.
Donations for environmental goods have been examined in the context of the contingent valuation method, comparing hypothetical and actual donations in response to contingent valuation surveys using voluntary donation mechanisms (Berrens, Jenkins-Smith, Bohara, & Silva 2002; Champ & Bishop, 2001; Foster, Bateman, & Harley 1997; MacMillan, Smart, & Thorburn 1999). This study differs from this past research in that the contributions are not solicited for the study itself and environmental donations behavior is examined for the United States as a whole. This will provide a useful reference for future studies to compare the effects of different respondent and household characteristics on environmental giving.
In this paper I draw insights from two papers in particular which utilized earlier years of Giving and Volunteering Survey data. Tiehen (2001) estimates price and income elasticities using pooled cross-sectional data and a cohort panel. She estimates price elasticities of -0.94 to -1.15 and also compares these to estimates from single year cross-sectional data, which are somewhat more elastic. Andreoni, Brown, and Rischall (2003) examine charitable contributions behavior of married couples utilizing information on the decision-making process (whether the respondent, spouse, or both are involved in contributions decisions). They find that the decision-making process does affect giving.
A previous economic study by Richer (1995) on giving to environmental organizations examined how the characteristics of the organizations and economic and political conditions influenced private voluntary contributions to the organizations. My study differs from this past study because I examine the household characteristics of environmental donors. I compare the characteristics of households that contribute to environmental organizations to the characteristics of other households.
Empirical Methods
The Giving and Volunteering in the United States data from the Independent Sector are from nationally representative surveys which include information on household charitable giving by type of giving. In this study I utilize the most recent round of the survey which was conducted through telephone interviews from May 14-July 22, 2001 with the data pertaining to giving in the year 2000. (3) This 2001 Giving and Volunteering survey has a sample size of 4,178, although the sample size for specific estimations in this study is somewhat smaller due to missing information for some of the relevant variables.
To examine the differences between households with environmental contributions and those without, a probit model is estimated. The estimation is based on the following model of contributions to the environment. Whether a household contributes to the environment can be represented by a binary variable, Y=1, if the household contributes, and zero if not. (4) However, the underlying theory involves Y*, which is the unobserved propensity to contribute to the environment:
[Y*.sub.i] = [gamma]'[X.sub.i] - [[mu].sub.i] (1)
where
[Y*.sub.i] is unobserved propensity to contribute to the environment
[X.sb.i] is vector of covariates
To examine the impact of household and respondent characteristics on the probability of contributing to the environment, the following probit model is estimated:
Pr([Y.sub.i] = 1|x) = F([gamma]'[x.sub.i]) (2)
Model 1 is estimated on the full sample, so those households who do not contribute to the environment ([Y.sub.i] = 0) include both households with non-environmental charitable contributions and households with no charitable contributions. However, donor households may be distinct from non-donor households, so to examine the extent that differences reflect differences in the characteristics of environmental donors relative to other donors, Model 2 is estimated including only households who make donations.
These probit models examine the extensive... |
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