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Does charitable gambling crowd out charitable donations? Using matching to analyze a policy reform

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  • Shih-Ying Wu

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Abstract

The impact of charitable lotteries on charitable donations depends on the motives of charitable donations, and is thus more an empirical question. Utilizing the propensity score matching method to overcome sample selection bias, this study estimates the effect of lotto outlays on direct charitable donations based on Taiwan’s experience of introducing a lottery in 2002. We find that people’s lottery spending neither crowds out nor crowds in charitable donations after the control group for lottery players is matched by propensity scores. The evidence thus suggests that people are more concerned about how they make their donations. Copyright Springer Science+Business Media New York 2014

Suggested Citation

  • Shih-Ying Wu, 2014. "Does charitable gambling crowd out charitable donations? Using matching to analyze a policy reform," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 21(6), pages 975-996, December.
  • Handle: RePEc:kap:itaxpf:v:21:y:2014:i:6:p:975-996
    DOI: 10.1007/s10797-013-9296-6
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    References listed on IDEAS

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    More about this item

    Keywords

    Charitable donation; Charitable lottery; Crowding-out; Altruism; Conspicuous giving; Propensity score matching; C21; D12; D64; H31;

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household

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