Is the Supply of Charitable Donations Fixed? Evidence from Deadly Tornadoes

Tatyana Deryugina and Benjamin Marx

No 27078, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Do new societal needs increase charitable giving or simply reallocate a fixed supply of donations? We study this question using IRS datasets and the natural experiment of deadly tornadoes. Among ZIP Codes located more than 20 miles away from a tornado's path, donations by households increase by over $1 million per tornado fatality. We find no negative effects on charities located in these ZIP Codes, with a bootstrapped confidence interval that rejects substitution rates above 16 percent. The results imply that giving to one cause need not come at the expense of another.

JEL-codes: D64 L31 Q54 (search for similar items in EconPapers)
Date: 2020-05
Note: EEE PE
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Citations: View citations in EconPapers (7)

Published as Tatyana Deryugina & Benjamin M. Marx, 2021. "Is the Supply of Charitable Donations Fixed? Evidence from Deadly Tornadoes," American Economic Review: Insights, American Economic Association, vol. 3(3), pages 383-398, September.

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