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Government or charity? Preferences for welfare provision by ethnicity

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  • Jones, Kristy

Abstract

There is debate about whether charity or government is better for alleviating poverty. While in many cases government agencies and private charity serve similar purposes, they can be perceived very differently by the public. This is particularly true for issues such as minority welfare where government spending has been historically ineffective. This paper investigates the role of recipient ethnicity in preferences for giving to private charity and government agencies. I present a real donation experiment where donors can donate to government organisations and private charities assisting a population in general, or assisting a particular ethnic group in that population. I find that giving depends not only on the organisation type but also the ethnicity of the beneficiary. Perceptions of organisational effectiveness are also found to affect giving. The findings of the experiment suggest that if the government is unable to improve outcomes it may need to consider outsourcing to private charity.

Suggested Citation

  • Jones, Kristy, 2017. "Government or charity? Preferences for welfare provision by ethnicity," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 66(C), pages 72-77.
    • Handle: RePEc:eee:soceco:v:66:y:2017:i:c:p:72-77
    DOI: 10.1016/j.socec.2016.04.011
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    References listed on IDEAS

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    1. Li, Sherry Xin & Eckel, Catherine C. & Grossman, Philip J. & Brown, Tara Larson, 2011. "Giving to government: Voluntary taxation in the lab," Journal of Public Economics, Elsevier, vol. 95(9-10), pages 1190-1201, October.
    2. Nadine Chlaß & Lata Gangadharan & Kristy Jones, 2015. "Charitable Giving and Intermediation," Monash Economics Working Papers 18-15, Monash University, Department of Economics.
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    7. Eckel, Catherine C. & Grossman, Philip J. & Johnston, Rachel M., 2005. "An experimental test of the crowding out hypothesis," Journal of Public Economics, Elsevier, vol. 89(8), pages 1543-1560, August.
    8. Richard STEINBERG, 1991. "Does Government Spending Crowd Out Donations?," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 62(4), pages 591-612, October.
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    Citations

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    Cited by:

    1. R. Andrew Luccasen & M. Kathleen Thomas, 2020. "Voluntary taxation and the arts," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 44(4), pages 589-604, December.
    2. Werfel, Seth H., 2018. "Does charitable giving crowd out support for government spending?," Economics Letters, Elsevier, vol. 171(C), pages 83-86.
    3. Kristy Jones, 2017. "Paternalism and Ethnicity in Giving," The Economic Record, The Economic Society of Australia, vol. 93(302), pages 420-433, September.
    4. Raúl López-Pérez & Aldo Ramírez-Almudio, 2020. "Why people give to their governments: The role of outcome-oriented norms," Working Papers 2007, Instituto de Políticas y Bienes Públicos (IPP), CSIC.

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    More about this item

    Keywords

    Altruism; Government; Charity; Ethnicity; Indigenous; Minorities; Experiment;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination

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