Do natural disasters increase charitable giving or simply reallocate a fixed supply of donations? We study this question using IRS data in the context of deadly tornadoes. We find that, among ZIP Codes located in the same state but more than 20 miles away from a tornado’s path, donations by households increase by about $2 million per tornado fatality. We find no negative effects of tornado fatalities on donations to charities located in these ZIP Codes. The results imply that giving in response to new needs need not come at the expense of other causes.
|Original language||English (US)|
|Journal||American Economic Review: Insights|
|State||Accepted/In press - 2021|