What is Philanthropy Good For?

1. What is Philanthropy Good For? René Bekkers Philanthropic Studies Seminar July 13, 2010

2. ‘Good causes’ In Dutch, third sector organizations are called ‘goede doelen’. Translated literally: they are ‘good causes’. But what are they actually ‘good’ for? In terms of a research question: What are the consequences of philanthropy?

3. Levels & dimensions Philanthropy has different effects at the micro, meso and macro-level. Taking a multidisciplinary perspective on philanthropy, we should look at effects in different dimensions: economic, sociological, psychological, medical and policy dimensions.

4. A 3 level model Cause Macro-level outcomes Meso-level outcomes Organization Micro-level outcomes Participant

5. In my previous work I have looked at the micro-level consequences of one specific type of philanthropy: volunteering. What impact does volunteering have on people? Does it change their outlook on life, their attitudes towards other people and towards charitable organizations, their networks, and their health?

6. An overview of studies

7. Basically… People are (self-)selected into volunteering based on characteristics that are often theorized as benefits of volunteering. You wouldn’t be able to tell this from cross-sectional data. The panel data that I’ve used clearly show that the effects of volunteering on attitudes & values are nil or modest (at best).

8. Yet for these people volunteering truly makes a difference in their lives.

9. Mortality risks among 55+ LASA respondents by volunteering

10. Older volunteers benefit with • Stronger feelings of control over their lives. • Fewer symptoms of depression. • Lower levels of neuroticism. • Better cognitive functioning. • Lower levels of functional impairment. • Fewer chronic illnesses. • Larger social networks.

11. What we don’t know. Volunteering is likely to have more effects on people’s lives because it is an active form of participation. But what about donating to charitable causes? What effects does charitable giving have on people’s lives, and on their attitudes towards charities?

12. Group level effects We know very little about the effects of philanthropy on groups or communities, probably because they are difficult to quantify. Volunteer action and programs funded by philanthropy may create a sense of community, social capital and social cohesion.

13. A new research question What does philanthropy contribute to the well-being of groups and local communities? Or: Which externalities result from the public goods produced by philanthropy? Answering this question requires new, geographic and group-targeted sampling strategies.

14. A 3 level model Cause Democracy, Inequality, Cohesion Sense of Community, Team Spirit Organization Social Networks, Health Participant

15. Macro-level Effects Economists have theorized that governments address market failures. One could say philanthropy addresses market failures and government failures. How (if at all) does philanthropy have an impact on government and corporate policy?

16. Potential effects • On democracy: philanthropy may produce (semi-) public goods that the government does not. • On inequality: philanthropy-funded (semi-) public goods may be excludable. • On government policy: cooperation vs. competition. • On donors: decreasing patience, growing irritation.

17. Organizational questions • The management of volunteers. • The efficiency of the charitable deduction. • The effectiveness of fundraising methods, fundraising cost ratios. • Fraud and misconduct in fundraising organizations. • Underground and terrorist financing. Probably not Definitely

18. Never change a winning team • “Who gives what and when?” remains an important research question that I will continue to work on. • GINPS data offer unique possibilities for studying the dynamics in giving and volunteering. • A twin study is planned to uncover the genetic and environmental etiology of generosity.