Individuals and Communities: the Importance of Neighbors Volunteering

Abstract

In this analysis, I examine the effects of community-level volunteering on an individual’s choices regarding time – whether to work and whether to volunteer. In order to better explain the decision to volunteer, a classic pure public goods structure is contrasted with a less restrictive impure public goods model that admits other possible private motivations. The results of this study undermine the neoclassical notion that volunteering can be understood solely as a pure public good that is provided less when others are seen to be contributing. In fact, individuals are found to be more, not less, likely to volunteer when others in their communities do so. An innovative instrumental variables strategy is used to account for reflection bias and the possible endogeneity caused by selective sorting of individuals into neighborhoods, which allows for a causal interpretation of these results. Employment regressions provide preliminary evidence that average volunteering relates, to some extent, with the decision of whether to participate in the labor force. Variations in the effect of average volunteering across age and gender are also explored. The present work is unique by virtue of its use of a large and representative dataset, along with rigorous statistical testing. I use United States Census 2000 Summary File 3 and Current Population Survey (CPS) 2004–2007 September Supplement file data and control for various individual and community-level characteristics.