Are Generous People More Likely to Vote?

Policymakers in the Unites States and many other countries encourage charitable giving through various subsidies. In the United States, for instance, charitable contributions can be deducted from taxable income making the price of giving inversely related to the marginal tax rate. However, the net effects of such subsidies can be better understood by exploring the relationship between generosity and other types of prosocial behavior. This paper investigates the spillover effects of charitable subsidies on voting behavior using four surveys of charitable giving in the United States conducted from 1992 to 2001. Understanding the relationship between these two prosocial behaviors may be quite important given the ongoing debates about designing alternative policies to increase voter turnout rates. The results show that charitable giving and voting are complements. Increasing the price of giving not only decreases the probability of giving and contribution amount but also the probability of voting in presidential elections with an implied elasticity of the propensity of vote with respect to the tax price of giving as much as -0.4. This effect is robust under different specifications and with different sets of instrumental variables. These results highlight the positive externalities created by charitable subsidies and have important implications for economic models of voting and charitable giving.