What happens to charitable giving when the economy falters?
As the new coronavirus pandemic sends the economy into a tailspin, Patrick Rooney, an economist at the Indiana University Lilly Family School of Philanthropy, and Jon Bergdoll, a philanthropy statistician, explain what usually happens to giving during recessions.
Do Americans give more to charity when more people are in need?
No. Overall, for the last 64 years total giving has grown at an average annual rate of 3.3% adjusted for inflation. But the picture changes if you compare what’s happened when the economy has grown versus when it has contracted. During years with economic growth, average giving has increased by 4.7%. During the years marked by economic downturns, average giving has actually decreased by 0.5%.
During economic downturns, more people are out of work and need a hand. But...