Characterizing voluntary donations for natural disaster mitigation in a third world country: A case of Bangladesh

Voluntary donation is a major source of public goods provision in the developed countries. Likewise, voluntary donations may be able to contribute to public problems in third world countries such as natural disaster mitigation. However, voluntary sector in third world countries has not been studied, and thus this paper addresses voluntary donations in Bangladesh with a specific eye on natural disaster mitigation. To this end, we conducted a questionnaire survey of 1000 respondents and elicited (i) a willingness to donate their labor (labor donation) and (ii) a willingness to pay (money donation) to collective countermeasures for avoiding the damages from cyclones and associated disasters. With this data, we analyze labor and money donations in relation to socio-economic variables such as income, education, family structure, and occupation using bivariate probit and Tobit regressions. The analysis finds that age, family structure, education, income and occupation are important determinants for Bangladeshi people to decide between labor and money donations as well as their respective amount. The poor and less educated households with the occupations of higher natural resource dependence are identified to contribute a large portion of overall donations via labor. The rich and more educated people are willing to donate money and little labor, but the magnitude of donations is rather small. In summary, labor and money donations exhibit the relation of substitutability with respect to most socio-economic variables, and education and income do not positively affect overall donations in Bangladesh. This finding is in sharp contrast with the studies in USA or Europe, and illustrates a possibility that labor donation is an important channel to natural disaster mitigation that should be utilized for public betterment in third world countries.