Time is money: Choosing between charitable activities

This paper analyzes the impact of a preferential tax-price for monetary donations on the joint decision to donate time (volunteer) and money. The methodological approach takes into account that consumption of each charitable good affects consumption of the other. Using data from a national survey on household charitable giving, the results show that donations of time and money are substitutes. However, a decrease in the tax-price of monetary donations also has a positive effect on donations of time that acts outside the change in relative prices. This more than offsets the substitution effect leading to an overall positive correlation between the two charitable goods.