Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/250616 
Year of Publication: 
2021
Series/Report no.: 
IZA Discussion Papers No. 14955
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
The permanent income hypothesis states that agents perfectly smooth consumption given a large, anticipated shock to income. Testing these implications is difficult given the endogenous nature of income and payment timing. We leverage exogenous variation in military bonus size and timing matched with donations from a large workplace charitable drive where soldiers contribute via payroll deductions during a fixed open enrollment period. Our findings suggest that soldiers are 5 to 10 percent more likely to contribute if they receive their bonus during the open enrollment period. We show that soldiers smooth donations more with age and increased bonus experience.
Subjects: 
charitable giving
altruism
income shocks
permanent income hypothesis
JEL: 
D9
D64
H31
Document Type: 
Working Paper

Files in This Item:
File
Size
447.6 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.