The Economic Value of the Charitable Sector
Chapter 10: Conclusions and Policy Implications
10.1 THE SIZE OF THE CHARITABLE SECTOR Part I of this volume was dedicated to measuring the size of the voluntary sector. While most studies have determined size by the measurement of income and expenditure by designated charities or the amount of employment associated with them, our own approach departs substantially from those studies by seeking the willingness to pay (WTP) for charitable services. The relevant WTP is that of the general public and the users, or beneﬁciaries, of the charities. To this end, we conducted extensive questionnaires with the general public, using stated preference procedures, and with one group of beneﬁciaries, the homeless. Our approach has the following advantages. First, as demonstrated in Chapter 1, it is rooted in the theory of welfare economics. Second, it enables us to lay the foundations for an approach to determining the efﬁciency of different forms of social provision. Third, it highlights the potential revenues that, in theory, charities could capture but which currently they do not, that is, the excess of WTP over actual donations. Fourth, it offers far more scope for a beneﬁciary-oriented approach to social provision. We argue that our approach provides a more accurate measure of the size of the voluntary sector. Rather than focusing on income and expenditure, which are, effectively, measures of the cost of the sector, WTP gives some idea of the beneﬁts of the sector to society at large. Our calculations for the UK suggest that the social value of...
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