Household donations of time and money in response to a health shock

Donations play a critical role in supporting the provision of public goods, yet how donating behaviour changes in response to health shocks is poorly understood. We investigate how the household's joint decision to donate time (volunteer) and money changes following a health shock. Using data from the United States Panel Study of Income Dynamics, and a within-household design that captures the dynamics of a post-health shock response, we find no overall change in the probability of households donating money but an overall reduction in the probability of donating time following a health shock. This is driven by a significant shift from donating both money and time to donating only money after a health shock. The shift away from donating time occurs for both the individual who experienced the health shock and their spouse, though the reduction is greater for the spouse. We examine the role of labour market responses to health shocks in explaining donating behaviour and find that consistent with the added worker effect, spouses of those who experience a health shock increase their work hours, constraining their time available for volunteering.

Automated summary

Donating behavior plays a vital role in supporting public goods, but the impact of health shocks on donating behavior is not well understood. This study examines how the joint decision of households to donate time and money changes after a health shock. Using data from the U.S. Panel Study of Income Dynamics, the study finds that there is no overall change in the probability of households donating money but a reduction in the probability of donating time following a health shock. This reduction is driven by a shift from donating both money and time to donating only money after a health shock, and it affects both the individual who experienced the health shock and their spouse, with a greater reduction observed for the spouse. The study also explores the role of labor market responses to health shocks in explaining donating behavior and finds that spouses of those who experience a health shock increase their work hours, limiting their availability for volunteering.