Ruhr Economic Papers

Ruhr Economic Papers #349

Time vs. Money – The Supply of Voluntary Labor and Charitable Donations across Europe

by Thomas K. Bauer, Julia Bredtmann and Christoph M. Schmidt

RWI, RUB, 07/2012, 31 S./p., 8 Euro, ISBN 978-3-86788-402-0 DOI: 10.4419/86788402

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Abstract

Volunteering plays a prominent role in the charitable provision of goods and services, yet we know relatively little about why individuals spend time and money to the charity. Assuming that volunteering is a consumption good, we analyze the determinants of individuals’ charitable cash donations and volunteer labor as well as the interdependence between both goods. Using data from the European Social Survey, we find a positive relationship between time and money contributions on the individual as well as on the country level. The hypothesis that time and money donations are gross complements, however, is not supported by our analysis, as we find evidence that individuals substitute time donations by money donations as the price of time raises. Analyzing philanthropic behavior on a disaggregated level reveals large differences in the determinants and the relationship of time and money donations – both across different types of voluntary organizations and across different welfare regimes.

JEL-Classification: H41, J22, L31

Keywords: Private philanthropy; charitable contribution; voluntary organizations

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