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Using Donor Preferences in Evaluating Public Expenditures: A Suggested Procedure

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  • Gregory B. Christainsen

    (California State University, Hayward)

Abstract

This article provides a means of assessing the contribution of public expenditures to allocative efficiency, given the preferences of those who make charitable contributions. A test statistic is derived, which, when compared to the actual volume of government subsidies received by enterprises, indicates whether they are over- or under-subsidized. The statistic is couched in terms of parameters for which empirical estimates can be made. Employing existing estimates of these parameters, the use of such a statistic is then illustrated with reference to public expenditures for rehabilitation facilities in which disabled persons perform remunerative work—sheltered workshops.

Suggested Citation

  • Gregory B. Christainsen, 1983. "Using Donor Preferences in Evaluating Public Expenditures: A Suggested Procedure," Public Finance Review, , vol. 11(3), pages 283-398, July.
    • Handle: RePEc:sae:pubfin:v:11:y:1983:i:3:p:283-398
    DOI: 10.1177/109114218301100302
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    References listed on IDEAS

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    1. Burton Abrams & Mark Schitz, 1978. "The ‘crowding-out’ effect of governmental transfers on private charitable contributions," Public Choice, Springer, vol. 33(1), pages 29-39, March.
    2. Smith, Vernon L, 1980. "Experiments with a Decentralized Mechanism for Public Good Decisions," American Economic Review, American Economic Association, vol. 70(4), pages 584-599, September.
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