An Empirical Test of Neutrality and the Crowding-Out Hypothesis
This paper tests P. G. Warr's neutrality hypothesis that the voluntary provision of a public good is independent of the distribution of income. Specifically, the author tests the null hypothesis of neutrality against the alternative that total contributions to a public good will be larger the less equally income is distributed. To test this hypothesis, a new data set is constructed by merging data on total voluntary contributions to individual public radio stations with 1990 Census data on the income distribution in each station's listening area. The author finds that voluntary contributions increase as income inequality rises. Copyright 1997 by Kluwer Academic Publishers
Volume (Year): 92 (1997)
Issue (Month): 3-4 (September)
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