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Terrorism and philanthropy: the effect of terror attacks on the scope of giving by individuals and households

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  • Claude Berrebi

    (Hebrew University)

  • Hanan Yonah

    (Hebrew University)

Abstract

Behavioral reactions to terrorism may be displayed in different ways. While some individuals react by holding back on their financial and charitable activities following stressful events, others may express more generosity by increasing their giving due to solidarity and empathy with the victims, or out of heightened nationalism and patriotism. Using a longitudinal analysis of the Israeli–Palestinian conflict as a case study to uncover the relations between terrorism and philanthropic behavior, we find that terror attacks increase considerably the scope of giving by individuals and households. Our empirical approach relies on a unique panel dataset of 152,731 tax itemizer philanthropists and terrorism data from 1999 to 2011. The results are statistically significant and robust across a multitude of model specifications. Furthermore, we use an instrumental variable approach to identify a causal link and address potential endogeneity concerns. This study is, to the best of our knowledge, the first attempt to empirically identify and quantify the effect of sequential terror attacks on philanthropy over a relatively long period using detailed micro-level information.

Suggested Citation

  • Claude Berrebi & Hanan Yonah, 2016. "Terrorism and philanthropy: the effect of terror attacks on the scope of giving by individuals and households," Public Choice, Springer, vol. 169(3), pages 171-194, December.
    • Handle: RePEc:kap:pubcho:v:169:y:2016:i:3:d:10.1007_s11127-016-0375-y
    DOI: 10.1007/s11127-016-0375-y
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Benny Geys & Salmai Qari, 2017. "Will you still trust me tomorrow? The causal effect of terrorism on social trust," Public Choice, Springer, vol. 173(3), pages 289-305, December.
    2. Benny Geys & Øystein Hernæs, 2021. "Party leaders and voter responses to political terrorism," Public Choice, Springer, vol. 187(3), pages 481-499, June.
    3. NEYMOTIN Florence & JONES J. Preston, 2018. "Showing Up After The Storm: Our “Fickle” Bleeding Heart?," Studies in Business and Economics, Lucian Blaga University of Sibiu, Faculty of Economic Sciences, vol. 13(3), pages 118-134, December.
    4. Claude Berrebi & Ariel Karlinsky & Hanan Yonah, 2021. "Individual and community behavioral responses to natural disasters," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 105(2), pages 1541-1569, January.
    5. Todd Sandler, 2016. "Political violence: an introduction," Public Choice, Springer, vol. 169(3), pages 161-170, December.

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    More about this item

    Keywords

    Terrorism; Philanthropy; Panel data;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • C36 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Instrumental Variables (IV) Estimation
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • H27 - Public Economics - - Taxation, Subsidies, and Revenue - - - Other Sources of Revenue
    • J10 - Labor and Demographic Economics - - Demographic Economics - - - General

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