René Bekkers Arjen de Wit Center for Philanthropic Studies VU University Amsterdam 11 th ISTR Conference Münster, Germany July 22, 2014 Look who's crowding-out! Correlates of willingness to substitute declining government contributions to charitable organizations

Crowding-out or crowding-in?

Three questions 1. How is the Dutch population responding to reductions in government support for nonprofit organizations? 2. How do responses to reductions in government support vary between causes and individual citizens? 3. Which mechanisms determine these responses?

What does previous research tell us? Arjen de Wit conducted a systematic literature review and meta-analysis of ‘crowding-out’ studies. Effect sizes published in previous research were analyzed and related to study characteristics. Effect sizes vary strongly between studies with sample composition and methods used.

A snapshot of estimates

A variety of findings Median effect size: -.17 = weak crowding out. Analyses of tax records and lab experiments produce more crowding out than surveys and field experiments. US studies find more crowding-out (-.23) than studies from Europe, which even find very weak crowding-in (.07).

The Civic Voluntarism Model ResourcesChange in contribution EngagementRecruitment Based on Verba, S., Schlozman, K.L. & Brady, H.E. (1995). Voice and Equality: Civic Voluntarism in American Politics. Cambridge: Harvard University Press.

Eight Mechanisms People give more when: 1.They perceive a need need 2.They are asked to give solicitation 3.Costs are lower, benefits highercosts/benefits 4.People care about the recipients altruism 5.Giving is rewarded sociallyreputation 6.Giving reinforces their self-imageself-rewards 7.Causes match their valuesvalues 8.Gifts are seen as more effectiveefficacy Bekkers, R. & Wiepking, P. (2011). ‘A Literature Review of Empirical Studies of Philanthropy: Eight Mechanisms that Drive Charitable Giving’. Nonprofit and Voluntary Sector Quarterly, 40(5):

Our first question 1. How is the Dutch population responding to reductions in government support for nonprofit organizations? 2. How do responses to reductions in government support vary between causes and individual citizens? 3. Which mechanisms determine these responses?

The scenario experiment In the Giving in the Netherlands Panel Survey 2012 we included a scenario experiment. 1,448 participants evaluated 3 scenarios, constructed randomly by combining information on hypothetical budget cut levels and sectors. Participants were reminded of their households’ contribution in the past year.

Example of scenario “With your household you donated €100 to health in the past year. If the government cuts 5% in this area, how would you react?” Response categories: I will give the same as last year I am willing to give more I will also give less [if more/less] What will be the new amount?

How the Dutch respond to cutbacks Average response across all 4,344 scenarios

Our second question 1. How is the Dutch population responding to reductions in government support for nonprofit organizations? 2. How do responses to reductions in government support vary between causes and individual citizens? 3. Which mechanisms determine these responses?

Responses vary by sector

Our third question 1. How is the Dutch population responding to reductions in government support for nonprofit organizations? 2. How do responses to reductions in government support vary between causes and individual citizens? 3. Which mechanisms determine these responses?

Resources, recruitment, engagement Odds ratios from logistic regression of willingness to contribute more after government cutback in at least one scenario (GINPS12, n=1,478; including controls for gender, age, income from wealth, home ownership, number of donation areas)

Values, reputation and efficacy Odds ratios from logistic regression of willingness to contribute more after government cutback in at least one scenario (GINPS12, n=1,478) Neither sizeable nor significant

Our three answers 1. In the aggregate, the Dutch population is not changing donation behavior in response to reductions in government support for nonprofit organizations. 2. However, responses vary strongly between causes and individual citizens. 3. The key mechanisms determining these responses are prosocial values, solicitation, reputation, and efficacy.

Specifically Those with more resources, receiving more solicitations and more generous donors are more likely to contribute more after government cutbacks. Those with a higher principle of care, more positive social norms on giving and charitable confidence are more likely to crowd-out. The principle of care is the only characteristic predicting the level of crowding-out.

More headlines VAST MAJORITY NOT RESPONSIVE TO CHANGES IN GOVERNMENT SUBSIDY Resources influence willingness to contribute through engagement, not recruitment Severity of budget cuts not related to the willingness to increase donations Committed donors most willing to increase donations

Contact details René Bekkers, and Arjen de Wit, ‘Giving in the Netherlands’, Center for Philanthropic Studies, Faculty of Social Sciences, VU University Amsterdam,