Variable Definitions and Sources

Independent Variables106

  • Consumer Sentiment

    Consumer sentiment is an index computed based on monthly surveys covering personal finances, business conditions, and buying conditions. Data for consumer sentiment come from the Consumer Sentiment Index, Federal Reserve Bank of St. Louis (FRED), research.stlouisfed.org

  • Corporate Profits

    Corporate profits are corporate income after subtracting expenses. Data for corporate profits come from the Bureau of Economic Analysis, U.S. Department of Commerce, bea.gov

  • Corporate Saving

    Corporate saving is corporate profits that are left over after taxes and dividend payments. Data for corporate saving come from the Bureau of Economic Analysis, U.S. Department of Commerce, bea.gov

  • Employment

    Employment is a measure of the number of U.S. workers in the economy that excludes proprietors, private household employees, unpaid volunteers, farm employees, and the unincorporated self-employed. Data for employment come from FRED, research.stlouisfed.org

  • GDP

    GDP is “the value of the production of goods and services in the United States, adjusted for price changes,” according to the Bureau of Economic Analysis, U.S. Department of Commerce. Data for GDP come from Table 1.1.5 at Bureau of Economic Analysis, U.S. Department of Commerce, bea.gov

  • Household and Nonprofit Net Worth

    Net worth for households and nonprofits is the net assets of households and nonprofits serving households after subtracting net liabilities. Data for the net worth of households and nonprofits come from FRED, research.stlouisfed.org

  • Tax Dummy

    The Tax Dummy is zero, except for 1986 when its value is one and 1987 when its value is negative one. The Tax Reform Act of 1986 implemented a two-step change in the highest individual tax rate from 50% in 1986, to 38.5% in 1987, and then to 28% in 1988. One would expect a spike in giving in 1986 as households shifted their planned giving forward to take advantage of the higher marginal tax rate in 1986. Likewise, one would expect a trough in giving in 1988 once the new lower tax rates were in effect. The 1987 response could have been positive or negative. In fact, the data show a large spike in 1986, followed by a substantial decline in 1987, and a return to normalcy in 1988. The explanation laid out here does not account for this behavior. Nevertheless, the effects are so large that we elected to model that behavior directly in order to avoid the effect of the one-time tax reform exerting an undue influence on the remaining coefficients.

  • Individual/Household Itemizers and Non-Itemizers

    Data for itemized tax returns come from the Internal Revenue Service (IRS), irs.gov. Data for non-itemized giving come from the Philanthropy Panel Study, Indiana University Lilly Family School of Philanthropy, philanthropy.iupui.edu, and Giving USA 2017: The Annual Report on Philanthropy for the Year 2016, researched and written by Indiana University Lilly Family School of Philanthropy and published by Giving USA Foundation, givingusa.org

  • Interest Rate for Governmental Securities

    The interest rate for governmental securities is the rate of return on an asset after removing the effect of inflation. Data for the interest rates of governmental securities come from FRED, research.stlouisfed.org

  • Personal Consumption

    Personal consumption is a measure of personal consumption expenditures, a measure of “goods and services purchased by U.S. residents” according to the Bureau of Economic Analysis, U.S. Department of Commerce, bea.gov. Data for personal consumption come from FRED, research.stlouisfed.org

  • Personal Consumer Expenditures

    “Personal consumption expenditures is the primary measure of consumer spending on goods and services in the U.S. economy. It accounts for about two-thirds of domestic final spending, and thus is the primary engine that drives future economic growth. Personal consumption expenditures show how much of the income earned by households is being spent on current consumption as opposed to how much is being saved for future consumption.”107 Data on consumer expenditures come from FRED, fred.stlouisfed.org

  • Personal Income

    Personal income is the income received by persons from participation in production, government and business transfers, and government interest. Data for personal income come from Table 2.1 at the Bureau of Economic Analysis, U.S. Department of Commerce, bea.gov

  • The S&P 500

    The S&P 500 is the value of the Standard & Poor’s 500 Index on December 31 of a given year. Data for the S&P 500 come from FRED, research.stlouisfed.org

Dependent Variables

  • Growth Rate for Individual/Household Giving

    The growth rate for individual/household giving includes cash and non-cash donations contributed by all American individuals and households to U.S. charities (including those who itemize their charitable contributions on their income taxes and those who do not). Historical data for the growth rate in individual/household giving were derived from Giving USA 2017: The Annual Report on Philanthropy for the Year 2016, researched and written by the Indiana University Lilly Family School of Philanthropy and published by Giving USA Foundation, givingusa.org

  • Growth Rate for Foundation Giving

    The growth rate for foundation giving includes grants made by all American foundations to U.S. charities. Historical data for the growth rate in foundation giving were derived from Giving USA 2017: The Annual Report on Philanthropy for the Year 2016, researched and written by the Indiana University Lilly Family School of Philanthropy and published by Giving USA Foundation,givingusa.org. Foundation giving data in Giving USA are based on estimates produced by the Foundation Center (foundationcenter.org) and include grants from community, private (including family), and corporate foundations.

  • Growth Rate for Estate Giving

    The growth rate for estate giving includes bequests (cash and non-cash donations) contributed by all American estates to U.S. charities (including those who itemize their charitable contributions on their estate taxes and those who do not). Historical data for the growth rate in estate giving were derived from Giving USA 2017: The Annual Report on Philanthropy for the Year 2016, researched and written by the Indiana University Lilly Family School of Philanthropy and published by Giving USA Foundation, givingusa.org

  • Growth Rate for Corporate Giving

    The growth rate for corporate giving includes cash and non-cash IRS itemized donations contributed to U.S. charities by all American corporations and corporate foundations. Historical data for the growth rate in corporate giving were derived from Giving USA 2017: The Annual Report on Philanthropy for the Year 2016, researched and written by the Indiana University Lilly Family School of Philanthropy and published by Giving USA Foundation, givingusa.org

  • Growth Rate for Education Giving

    The growth rate for education giving includes cash and non-cash donations from itemizing and non-itemizing American households to U.S. educational charities, including institutions of higher education, private K-12 schools, vocational schools, libraries, educational research and policy, and many other types of organizations serving educational purposes. Historical data for the growth rate in education giving were derived from Giving USA 2017: The Annual Report on Philanthropy for the Year 2016, researched and written by the Indiana University Lilly Family School of Philanthropy and published by Giving USA Foundation, givingusa.org

  • Growth Rate for Health Giving

    The growth rate for education giving includes cash and non-cash donations from itemizing and non-itemizing American households to U.S. health charities, including nonprofit community health centers, hospitals, and nursing homes; organizations focused on the treatment and/or cure of specific diseases; emergency medical services; wellness and health promotion; mental healthcare; health research; and other types of health organizations. Historical data for the growth rate in health giving were derived from Giving USA 2017: The Annual Report on Philanthropy for the Year 2016, researched and written by the Indiana University Lilly Family School of Philanthropy and published by Giving USA Foundation, givingusa.org

  • Growth Rate for Public-Society Benefit Giving

    The growth rate for public-society benefit giving includes cash and non-cash donations from itemizing and non-itemizing American households to U.S. public-society benefit charities, including independent research facilities, community development organizations, human and civil rights organizations, philanthropy associations, national donor-advised funds, United Ways, federated charities, and other types of organizations. Historical data for the growth rate in public-society benefit giving were derived from Giving USA 2017: The Annual Report on Philanthropy for the Year 2016, researched and written by the Indiana University Lilly Family School of Philanthropy and published by Giving USA Foundation, givingusa.org