Behavioral Economics Seminar: Why does church tax give a higher revenue than donations?

The Behavioral Economics group at IFRO invite to open seminars with a range of subjects within Behavioral Economics.

Sidsel Kjems, PhD fellow at Department of Food and Resource Economics, University of Copenhagen, will present: Why does church tax give a higher revenue than donations

Abstract

Comparing the sources and level of financing of seven national churches in the Nordic countries, England and Scotland shows that financing by a taxation right yields larger revenue for a national church then financing by general tax over the state or municipality budgets. Tax-deductible, private donations yield the lowest revenue of the three financing models.

Classic economic theory finds it hard to explain why volunteer tax yields revenue that are 5-8 time higher than volunteer donations; even though donations are tax-deductible and the church tax is not. The discussion draws on the psychology of Behavioral Economics to explain this phenomenon.

For further information, contact:
Catrine Jacobsen, cj@ifro.ku.dk