Giving In A Time Of Terrorism

Abstract

Recent research in psychology suggest that altruism and altruistic decisions may, in fact, be endogenous and depend on the social situation in which people find themselves. People are more likely to be altruistic, to give to charities and others in need, when they feel secure and safe. This paper looks at the implications of a persons perceived state of security on giving now that there are terrorist threats in the U.S. We use data from the Center on Philanthropy Panel Study (COPPS), and the Panel Study of Income Dynamics (the PSID) to test for endogenous changes in giving and volunteering from before and after the 2001 terrorist attacks. We find evidence indicating that increasing uncertainty resulted in a decline in the giving of both money and time, holding other variables constant, but the relationship is not significant.