Essays on Philanthropy

Abstract

My thesis explores two aspects of philanthropy, the problem of asymmetric information between donors and the charities they support and corporate philanthropy in the Czech and Slovak Republics. The topics were inspired by real life problems observed in these countries, namely, the lack of trust in and information about nonprofit organizations and the need to inspire new, local donors to replace the disappearing foreign funding of nonprofit organizations. The first two chapters of my thesis deal with the problem of asymmetric information that arises between donors and the charities they support. I focus on one particular solution to this problem, certification, a mechanism where an independent agency evaluates the charities that voluntarily apply for certification and pay a fee. The certificate serves as a signal of quality. The first chapter, co-authored with Andreas Ortmann, addresses the question of a certifier's motivation and the welfare implications of this institution. We compare the behavior of a nonprofit and a for-profit certifier and analyze the welfare consequences in both cases. We observe that a profit-maximizing certifier is able to divert all funds from the charities to himself without providing any service to the market or increasing the welfare. The nonprofit certifier, on the...

The basic concern of any empirical work is to employ statistical data that correspond to the notion of the theoretical variables in the model. The problems and economic consequences connected with the measurement of selected economic variables are the focus of this thesis. It consists of three chapters that in succession analyze the issues associated with the measurement of economic growth, multi-factor productivity and capital input into production. The first chapter looks into the differences among the growth rates of GDP per capita based on data from the three most commonly used databases, namely International Financial Statistics, World Development Indicators and Penn World Table. Using a wide international dataset, we find significant differences in the growth rates that are mainly due to the adjustment for cross-country comparability of GDP per capita levels. Importantly, these differences are correlated with the level of development. We replicate six recent studies of growth determinants and find their results sensitive to the choice of data. The second chapter analyses the sensitivity of calculated multi-factor productivity (MFP) growth to assumptions of growth accounting, concentrating on the measurement of quantity, composition and the respective shares of labor and capital inputs, and...