November 27, 2012

Charity and Christmas: a message about giving

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Give to charity this Christmas

Here is the video of my message about economic reasons for why you should give to charity this Christmas (the transcript is below):

I’m here to say a few words about Christmas on behalf of the Economics Department and the University of Warwick. My Christmas message is about “Charitable Giving at Christmas”.

Christmas is a time of giving. We give all sorts of things at Christmas: we give our loved ones presents under the Christmas tree and kisses under the mistletoe; Father Christmas, Hanukkah and Kwanzaa give gifts to children all over the world; we give Christmas greetings to our neighbours and to our friends, and we give smiles to strangers. Christmas is indeed a very special time of year.

But there is another kind of giving that we also do, and not just at Christmas time but throughout the year. This kind of giving is directed not towards our loved ones but towards strangers. We call this charitable giving.

I’m an economist. A lot of people might think of economics as being all about people trying to make lots of money for themselves. But actually, economics is also about charitable giving. Charitable giving is a really important part of economic activity, and it is something that we actively study as academic economists.

Why do we give to charity? Do we do it because we care about others and feel for them? Do we do it because our religious beliefs demand it? Do we do it in memory of those who are no longer with us? Or maybe charitable giving motives are not that charitable? Maybe we are trying to show off to our friends, our colleagues, our business associates?

We still don’t fully understand the real motives behind charitable giving. But more and more people are studying this question and we are getting closer and closer to understanding the answers.

Whatever the reasons for it, charitable giving and the activities that are funded by it – activities that take place in the charitable sector – represent a big and growing fraction of all economy activity: there are almost 163,000 charities registered with the UK Charity Commission, and in 2012 their total annual income was almost 60 billion pounds; of that total, almost nine and a half billion pounds came from charitable contributions made by people from all over the United Kingdom. And market economies have now come to count on private giving to function properly and invest in the future. For example, in the UK, charitable donations towards medical research amount to more than one billion pounds, which represents more than one-third of all public expenditure on medical research in the UK.

What is the link between charitable giving and Christmas time? At Christmas time, we all watch reruns of a “Christmas Carol” and Frank Capra’s “It’s a Wonderful life,” which ends with Jimmy Stewart being saved from financial ruin by his community all coming together to help him. At Christmas time we are all tingling inside with nice feelings towards others. But do these nice feelings and tingling sensations translate into more charitable donations? Yes, they do. Charitable donations do increase around Christmas time and throughout the month of December. This ‘December effect’ may even amount to something like a doubling of charitable donations in comparison with levels of giving in September, or October or November.

But times are hard. The recent economic troubles mean that the needs of those counting on charitable giving have become greater than before; yet government budgets are tighter, and so are the budgets of individuals and households that give to charity. Giving is needed more now than ever, and yet recent figures show that giving is down on previous years – there were almost 2 billion pounds fewer charitable contributions made this year compared to last year, which is a drop of more than 15 percent. It’s beginning to look a lot like a Grinchy Christmas for the neediest.

Then, my Christmas message is this: please, give this Christmas, and not just to your loved ones, but to charity. Why am I, an economist, telling you this? Because academic research says it’s good for you: giving can help you feel more socially confident and this is contagious. Give more to charity this Christmas, and not only will you help others, but you’ll also feel better about yourself and you will encourage others to give and they will feel better about themselves too. Everyone’s happier! That’s beginning to feel a lot more like Christmas to me.


- 5 comments by 1 or more people Not publicly viewable

  1. Peter Holbrook

    Of course giving to charity is a good thing and I, like you would encourage people to give as much as they can afford but the reality is that the value of donations going to charities is actually down. I fear that its a trend that is set to continue as people struggle with the cost of living increases and salaries (if you’re lucky enough to be in work) remaining pretty flat.
    I’d urge people to think about social and environmental issues not only when they give but also when they buy, seek work or even invest. The truth is that buying social this Christmas will have a much greater impact on the world than the few quid you choose to give.
    Social enterprises are businesses that exist for a primary social benefit – they operate in all parts of the economy and produce all sorts of things perfect for Christmas; cufflinks, chocolate, bicycles, underwear, toiletries, hampers, leisure goods, clothing…. the list goes on and on. How much better to buy something with you limited Christmas budget than shop on Amazon (allegedly aggressive tax avoiders) for cheap tat made low paid and often exploited workers in the developing world and then shipping it halfway across the world. Yes, give this Christmas but more importantly buy social!

    Peter Holbrook
    CEO, Social Enterprise UK

    05 Dec 2012, 13:02

  2. Kimberley Scharf

    Hi Peter: Thanks so much for the comment, you are making a really good point and I agree with it – if I get another chance to record a new message about this next year, I will give it due weight. Very best regards, Kim

    05 Dec 2012, 19:12

  3. Clare Bovill

    Give and give young ….... encourage children to give to charity…...... I give to charity because my parents encouraged me to so. Let’s inspire the next generation!

    09 Dec 2012, 02:11

  4. James franklin

    I am here to give my views on this; there are many advantages to giving to charity. Of course, it makes you feel good, but it also provides some additional benefits also like in tax deduction, so it’s not necessary to wait for any occasion, you can donate or you should donate whenever you get time.

    charities Australia

    01 Mar 2013, 07:59

  5. Jason

    The best charity program would be the during the Christmas, in this season this is one of the best, people are welling to give.

    24 Apr 2013, 08:14

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About me

I am a professor of economics at Warwick University. During the academic year 2015-2016, I am on sabbatical from Warwick and am spending most of my time in London where I am Visiting Professor at the LSE and Visiting Scholar at the National Audit Office.
My research has a broad methodological base, spanning several subfields of economics – political economy, public finance, international trade and finance, industrial organisation – and reaches out to other disciplines where research synergies can be mutually explored – e.g., neuropsychology, marketing, decision sciences. A distinctive theme that runs through many of my research projects is understanding how private behaviour and incentives, as well as government policies, shape the structure, performance and boundaries between the public sector and the non-profit sector – these questions have so far been little studied by academics but they are central to many key policy debates. My research has been published in leading peer-reviewed journals, including general-interest journals such as the Economic Journal, the International Economic Review, and the Review of Economic Studies; and in top field journals such as the Journal of Public Economics and International Tax and Public Finance. It has been funded by the Economic and Social Research Council (ESRC), the Social Sciences and Research Council of Canada, the British Academy, the European Research Council (Marie Curie program), HM Treasury (HMT) and HM Revenue and Customs (HMRC).

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