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Study Reveals The Geography of Charitable Giving

Filed by KOSU News in US News.
August 20, 2012

Ever wonder how charitable the people are who live in your state or community? It turns out that lower-income people tend to donate a much bigger share of their discretionary incomes than wealthier people do. And rich people are more generous when they live among those who aren’t so rich.

That’s according to a new study by the Chronicle of Philanthropy, which breaks charitable giving down by ZIP code. It found that generosity varies greatly from one region of the country to another.

Take the 20020 ZIP code area in Southeast Washington, D.C. It includes the Fairlawn and Anacostia neighborhoods, which are among the city’s poorest. Many in the area turn to charity for help.

One of those charities is a nonprofit called Bread for the City, where people line up daily for help with housing, health care, legal aid and food. But in this neighborhood, where the need is so great, charitable giving is also relatively high. Using Internal Revenue Service data, the Chronicle of Philanthropy found that the median household contribution is almost 19 percent of discretionary income — that’s money left over after taxes and living expenses. This rate of giving is four times the national average.

Kristin Valentine, Bread for the City’s development director, says she’s not surprised. Even their clients give when they can, though it’s often a few dollars at a time.

“They see every day more need than probably the average person,” she says.

The Chronicle found a similar pattern across the nation. Households with incomes of $50,000-$75,000 donate on average 7.6 percent of their discretionary income. That’s compared with about 4 percent for those with incomes of $200,000 or more.

Peter Panepento, the Chronicle’s assistant managing editor, says religious giving, which makes up the bulk of U.S. donations, is a major factor.

“States like Utah and Alabama and Mississippi all end up very high on our list,” he says. “And states where [there's] more of a secular mindset, particularly in New England and all along the coast, tended to show up lower on the list.”

Panepento says this also explains some of the differences among income groups, because lower-income donors tend to give a lot of their charitable dollars to churches.

But there’s something else going on as well.

Cheryl Curtis and her husband, Dana Foster, are among the few upper-income families that live in the same ZIP code where Bread for the City is located. They’re both attorneys, and are among the charity’s most generous donors. Last year, they gave $1,000.

“Now that I have more, I want to give to organizations that provide just basic food for people,” Curtis says. “I grew up very poor, on welfare and food stamps. And so as a kid, I know what it’s like to not have food every day of the month.”

It turns out that giving by high-income residents in this area is about 12 percent of discretionary income, a much higher rate than in D.C.’s richest neighborhoods.

The Chronicle found that it’s the same across the country. High-income people who live in economically diverse neighborhoods give more on average than high-income people who live in wealthier neighborhoods.

Paul Piff, a social psychologist at the University of California, Berkeley, says that’s consistent with what he’s found in years of research on income and giving.

“The more wealth you have, the more focused on your own self and your own needs you become, and the less attuned to the needs of other people you also become,” he says.

Piff says it’s not that rich people aren’t generous. They’re often just isolated. They don’t see a lot of poor people in their daily lives.

“Simply reminding wealthy people of the diversity of needs that are out there is going to go a long way toward restoring the empathy or compassion deficit that we otherwise see,” he says.

So what does this mean for charities? Bread for the City’s Valentine says the big bucks are still in the wealthiest neighborhoods. The key is to get those who live there to become more attuned to those in need. That means having nonprofit clients tell their stories more often, either online or in person. It also means providing more volunteer opportunities, so people can see the need firsthand. [Copyright 2012 National Public Radio]

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