Public debates on philanthropy link charitable giving to wealth. In the media we hear a lot about the giving behavior of billionaires – about the giving pledge, the charitable foundations of the wealthy, how the causes they support align their business interests, and how they relate to government programs. Yes – the billions of tech giants go a long way. Imagine a world without support from foundations created by wealthy. But we hear a lot less about the everyday philanthropy of people like you and me. The media rarely report on everyday acts of generosity. The force of philanthropy is not only in its focus and mass, but also in its breadth and popularity.
It is one of the common remarks I hear when family, friends and colleagues return from holidays in ‘developing countries’ like Moldova, Myanmar or Morocco: “the people there have nothing, but they are so kind and generous!” The kindness and generosity that we witness as tourists are manifestations of prosociality, the very same spirit that is the ultimate foundation of everyday philanthropy. And also within our own nations, we find that most people give to charity. Why are people in Europe so strongly engaged in philanthropy?
The answer is trust
In Europe we are much more likely to think that most people can be trusted than in other parts of the world. It is this faith in humanity that is crucial for philanthropy. We can see this in a comparison of countries within Europe. The figure combines data from the World Giving Index reports of CAF from 2010-2017 on the proportion of the population giving to charity with data from the Global Trust Research Consortium on generalized social trust. The figure shows that citizens of more trusting countries in Europe are much more likely to give to charities (you can get the data here, and the code is here). The correlation is .52, which is strong.
Egalité et fraternité
One of the reasons why citizens in more trusting countries are more likely to give to charity is that trust is lower in more unequal countries. Combining the data on trust with data from the OECD on income inequality (GINI) reveals a substantial negative correlation of -.37. The larger the differences in income and wealth in a country become, the lower the level of trust that people have in each other. As the wealth of the rich increases, the poor get increasingly envious, and the rich feel an increasing urge to protect their wealth. In such a context, conspiracy theories thrive and institutions that should be impartial and fair to all are trusted less. The criticism that wealthy donors face also stems from this foundation: those concerned with equality and fairness fear the elite power of philanthropy. Et voila: here is the case why it is in the best interest of foundations to reduce inequality.