MONEY DONATIONS, VOLUNTEERING AND ORGANIZATIONAL EFFICIENCY

The purpose of this article is to explain the cross-sectional variatio n in money donations to charities at the organizational level. Using a unique data base which includes volunteer labor data, this article te sts the hypotheses that money donations are positively related to volu nteering and the technical efficiency of the firm. Technical efficienc y is measured by a number of non-parametric indices. The empirical res ults indicate inter alia that the more technically efficient the chari ty, the more money donations it is able to raise. Moreover, at least f or one model, money donations and volunteering are found to be complem entary at the organizational level. In addition, the results in this a rticle are not consistent with the well-known hypothesis that governme nt financing crowds out private donations.