Despite Downturn, There's Hope for U.S. Charitable Giving, Boston College Researchers...

Fri Oct 10, 2008 2:02pm EDT

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Despite Downturn, There's Hope for U.S. Charitable Giving, Boston College
Researchers Tell National Conference of Fundraisers

CHESTNUT HILL, Mass., Oct. 10 /PRNewswire-USNewswire/ -- Despite the turmoil
on Wall Street and the ongoing economic turbulence, charitable giving levels
may not be affected as much or for as long as some may fear, according to
researchers at Boston College's Center on Wealth and Philanthropy.

In a speech before a gathering of U.S. fundraising professionals at BC, John
J. Havens, a leading authority on empirical patterns of wealth, said that
there could be up to a year before the impact of the current crisis is seen in
charitable giving levels.
 
The nation is currently in "a wealth recession," defined as three successive
quarters with a decrease in the real value of wealth in the U.S., according to
Havens.

In the previous recession, he said, the nation began to see a decline in net
wealth in 1999, well before the burst of the dot-com bubble and the ensuing
2000 stock-market crash brought on a downward growth in wealth that continued
for three years. Aggregate household wealth, he said, declined by 15 to 20
percent from 1999 to 2002 -- the largest and deepest such downturn since the
1930s.

But these variations in net worth did not directly correlate with changes in
philanthropic giving, Havens said. Average household contributions did not
begin to fall until 2000, and they did not drop as much as households' net
worth did: From 1999 to 2002, net worths dropped by as much as 20 percent,
while donations decreased only 10 percent.

Also, he said, when net wealth began to rise again in 2002, donations also
began to increase.

In the current scenario, Havens said, since the net wealth of households began
to decline in late 2007, there could be a lag of up to a year before donations
decline, partly due to the fact that high-net worth donors tend to plan their
contributions a year ahead, and partly because the decline in total donations
may not be significant.

Havens did offer a strong caveat, however: Though household incomes
historically have proven more stable than net wealth, if incomes were to
decline significantly, the resulting impact on charitable donations would
likely be far greater.

Havens made his remarks at a conference on "The Supply and Demand of
Philanthropy in the 21st Century," sponsored by BC's Center on Wealth and
Philanthropy, the Association of Fundraising Professionals, and the Eaton
Vance Investment Counsel.

In addition to Havens, keynote speakers at the event Oct. 7-8 included Anne E.
Sternlicht, vice president for Eaton Vance Investment Counsel, Museum of Fine
Arts/Boston Campaign Director and Deputy Director Patricia B. Jacoby, and BC
Center on Wealth and Philanthropy Director Paul G. Schervish, one of the
nation's foremost experts on the subject of wealth, philanthropy and donor
behavior, five-time recipient of The Non-Profit Times' "Power and Influence
Top 50" designation, and developer of the concept of "moral biography" as
applied to philanthropy.

"One key characteristic of this crisis," said Schervish, "is that it has
certainly affected the top eight percent of households of the income-wealth
spectrum, which is responsible for more than 50 percent of charitable giving.
So the challenge facing charitable and philanthropic enterprises is to see if
the emotional identification that can be elicited from the donor -- the sense
of caring -- can overcome what is, for now, still hoped to be a temporary
crisis."

The Center on Wealth and Philanthropy (CWP) is a multidisciplinary research
center specializing in the study of spirituality, wealth, philanthropy, and
other aspects of cultural life in an age of affluence. Founded in 1970, CWP is
a recognized authority on the relation between economic wherewithal and
philanthropy, the motivations for charitable involvement, and the underlying
meaning and practice of care. For more information, visit
http://www.bc.edu/research/cwp/ or call 617-552-4070.

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appropriate link.

Paul G Schervish
http://profnet.prnewswire.com/Subscriber/ExpertProfile.aspx?ei=37171


SOURCE  Boston College

Patricia Delaney of Boston College Public Affairs, +1-617-552-3352,
delaneyp@bc.edu
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