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Inequality and Charity

Author

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  • Mastromatteo, Giuseppe
  • Russo, Francesco Flaviano
Abstract
We study empirically the relationship between inequality and active charity participation. Increased inequality can trigger feelings of empathy and compassion, thereby increasing altruism, and it can enhance the worm-glow feeling associated with giving. However inequality can also increase social distance and, therefore, social segregation, decreasing the participation to charities because of a weaker identification with the needy. Our empirical analysis features individual data on charity participation from the World Values Survey, merged with country-level information on inequality from the World Bank Development Indicators. We find that income inequality is positively associated with the probability to actively participate in charitable organizations, even after controlling for economic, sociological, demographics, cultural, and religious factors. We also find that women, religious people, and more educated individuals have a higher probability to actively participate in charities. Since charitable organizations mostly perform redistributive tasks, we also checked whether the generosity of the welfare state crowds out the participation in them, but we found no evidence of this relationship.

Suggested Citation

  • Mastromatteo, Giuseppe & Russo, Francesco Flaviano, 2017. "Inequality and Charity," World Development, Elsevier, vol. 96(C), pages 136-144.
    • Handle: RePEc:eee:wdevel:v:96:y:2017:i:c:p:136-144
    DOI: 10.1016/j.worlddev.2017.03.003
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    2. Simixhiu, Amantia & Ziegler, Andreas, 2018. "On the relevance of income and behavioral factors for absolute and relative donations: A framed field experiment," VfS Annual Conference 2018 (Freiburg, Breisgau): Digital Economy 181600, Verein für Socialpolitik / German Economic Association.
    3. Cha, Moon-Kyung & Yi, Youjae & Lee, Jaehoon, 2020. "When people low in social class become a persuasive source of communication: Social class of other donors and charitable donations," Journal of Business Research, Elsevier, vol. 112(C), pages 45-55.
    4. Hughes, Emma & Scheyvens, Regina, 2021. "Tourism partnerships: Harnessing tourist compassion to ‘do good’ through community development in Fiji," World Development, Elsevier, vol. 145(C).
    5. Amalia, Nadira & Moeis, Jossy P. & Arundina, Tika & Pertiwi, Ristiyanti Hayu & Mardhatillah, Amy, 2021. "Impact analysis of religiosity and altruism on multidimensional inequality;," International Review of Economics & Finance, Elsevier, vol. 71(C), pages 517-525.
    6. Hossein Sabzian & Alireza Aliahmadi & Adel Azar & Madjid Mirzaee, 2018. "Economic inequality and Islamic Charity: An exploratory agent-based modeling approach," Papers 1804.09284, arXiv.org.

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