individual decision making and organizational positioning
TRANSCRIPT
Individual Decision Making and Organizational Positioning
Arjen de Wit 43rd ARNOVA Annual Conference
November 21, 2014, Denver, CO
A Test of Crowding-Out in the Dutch Voluntary Sector
ShiBing policies
• Budget cuts • ‘Big Society’ (UK) • ‘Do-‐democracy’ (Netherlands)
• ‘ParPcipaPon society’ (Netherlands) • What are the consequences for nonprofits?
The crowding-‐out hypothesis
• If government increase subsidies with $1, private donaPons decrease with $1
The crowding-‐out hypothesis
• If government increase subsidies with $1, private donaPons decrease with $1
• Like a waterbed
What’s the evidence?
De Wit, A. & Bekkers, R. ‘ Government Support and Charitable DonaPons: A Meta-‐Analysis of the Crowding-‐Out Hypothesis’. Submi`ed to Public Administra0on Review.
Valid tesPng?
• Laboratory experiments in which undergraduate students don’t decide over their own money, are aware of parPcipaPng in research and have full informaPon
• Aggregate measures of nonprofit revenue sources
Why would we expect crowding-‐out?
Why would we expect crowding-‐out?
• Individuals change their giving decision • Organiza0ons posiPon themselves differently in the nonprofit market
Individual behavior
• DonaPng has public and private benefits • Public benefits can equally well be produced by others, i.e. the state
• But… • Do people know about subsidies? (Horne et al. 2005)
• Are they capable of changing their giving? • And do they value the public benefits? (Andreoni 1989, 1990)
Individual behavior
• DonaPng has public and private benefits • Public benefits can equally well be produced by others, i.e. the state
• But… • Do people know about subsidies? (Horne et al. 2005)
• Are they capable of changing their giving? • And do they value the public benefits? (Andreoni 1989, 1990)
Individual behavior
• DonaPng has public and private benefits • Public benefits can equally well be produced by others, i.e. the state
• But… • Do people know about subsidies? (Horne et al. 2005)
• Are they capable of changing their giving? • And to what extent do they value public benefits vs. private benefits?
OrganizaPonal posiPoning
• Nonprofit organizaPons have lower need to look for alternaPve sources of income when government subsidies increase
• ‘Fundraising crowding-‐out’ (Andreoni & Payne 2003, 2011)
OrganizaPonal posiPoning
• Nonprofit organizaPons have lower need to look for alternaPve sources of income when government subsidies increase
• ‘Fundraising crowding-‐out’ (Andreoni & Payne 2003, 2011)
• But…
OrganizaPonal posiPoning
• Nonprofit organizaPons have lower need to look for alternaPve sources of income when government subsidies increase
• ‘Fundraising crowding-‐out’ (Andreoni & Payne 2003, 2011)
• But… • How do organizaPons use extra revenues? • Is fundraising equally effecPve across persons?
The current data
• Giving in the Netherlands Panel Study (GINPS) – Change in donaPons between two years – N = 1,879
• Central Bureau on Fundraising (CBF) – Change in government subsidies between two years (lagged)
– 17 organizaPons
Results
Linear regression on Δ Dona'ons
Δ Subsidies
Media coverage * Δ Subsidies
Higher educated * Δ Subsidies
Paid job * Δ Subsidies
Own home * Δ Subsidies
Private benefit * Δ Subsidies
(Constant)
Increases in subsidies are followed by increases in donaPons…
Linear regression on Δ Dona'ons
Δ Subsidies 0.831 **
Media coverage * Δ Subsidies
Higher educated * Δ Subsidies
Paid job * Δ Subsidies
Own home * Δ Subsidies
Private benefit * Δ Subsidies
(Constant) -‐ 0.110
…irrespecPve of whether they are reported in newspapers…
Linear regression on Δ Dona'ons
Δ Subsidies 0.831 ** -‐ 0.128
Media coverage * Δ Subsidies 0.964
Higher educated * Δ Subsidies
Paid job * Δ Subsidies
Own home * Δ Subsidies
Private benefit * Δ Subsidies
(Constant) -‐ 0.110 -‐ 0.915
…and more strongly among the higher educated.
Linear regression on Δ Dona'ons
Δ Subsidies 0.831 ** -‐ 0.128 1.155 (*)
Media coverage * Δ Subsidies 0.964
Higher educated * Δ Subsidies 0.748 *
Paid job * Δ Subsidies 0.019
Own home * Δ Subsidies -‐ 0.203
Private benefit * Δ Subsidies -‐ 0.136
(Constant) -‐ 0.110 -‐ 0.915 -‐ 4.262 **
Increases in subsidies are followed by increases in fundraising spending…
Linear regression on Δ Fundraising
Δ Subsidies 0.022 **
(Constant) 0.116 **
…but this cannot explain the relaPon between subsidies and donaPons.
Linear regression on Δ Dona'ons
Δ Subsidies 0.831 ** 0.771 ** 0.774 **
Δ Fundraising spending 2.783 ** 4.401 *
Asked * Δ Fundraising spending -‐ 2.270
(Constant) -‐ 0.110 -‐ 0.434 -‐ 1.462 (*)
Why don’t we find crowding-‐out?
Why don’t we find crowding-‐out?
• The sample is not representaPve
Why don’t we find crowding-‐out?
• The sample is not representaPve • The Netherlands is different from the US
Why don’t we find crowding-‐out?
• The sample is not representaPve • The Netherlands is different from the US
• It doesn’t exist
Thank you
Arjen de Wit
Center for Philanthropic Studies
VU University Amsterdam
www.giving.nl