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Growth Fact #8 of 10: Giving Charity a Boost

Article by STRATeCOMM - We Got Web April 19, 2012 //   2 minute read

The editors of the 4% Growth Project asked Bush Growth Fellow Ike Brannon to look into 10 things that would happen if the U.S. economy grew at 4% each year in real terms for 10 years. We will unveil one growth fact each week. To read all previous growth facts, click here. Growth Fact #8 of 10: If the economy grew at 4% per year, charitable contributions would increase by $200 billion over the next decade, improving health care, the environment, and the arts, with $28 billion more in donations for education alone.[i]

[i] Higher levels of charitable giving increase the standard of living for the poor in the form of food, shelter, clothing and medical care. See Heinemann, Friederich, “Voluntary Giving and Economic Growth: Time Series Evidence for the U.S.,” Center for European Economic Research, Discussion Paper 10-075, 2010. Charitable giving figures are from the Giving USA Foundation’s “Annual Report on Philanthropy for the Year 2010.” Heinemann estimates an income elasticity for charity of 1.32, and charitable giving for 2011 was approximately $300 billion. The report also estimates that 14% of donations go toward education.