Examining the association of welfare state expenditure, non-profit regimes and charitable giving

This paper explores cross-country variations in charitable giving and investigates the association of welfare state policies with private philanthropy. Hypotheses are drawn from crowding-out theory and considerations about the influence of a country’s mixed economy of welfare. We add to the on-going discussion concerning the crowding-out hypothesis with empirical evidence by looking at specific charitable subsectors people donate to across countries. Using Eurobarometer survey data that include 23 countries, we find no evidence for a crowding-out effect, but rather a crosswise crowding-in effect of private donations. Moreover, giving behaviour differs between non-profit regimes.