Charitable Fundraising, Government Advocacy and Public Health Crisis

The Covid-19 pandemic is bringing new changes to the government-charity relationship. This paper presents Chinese evidence on how charitable organizations target their fundraising effort facing the pandemic shock and the collaborative advocacy from the government. For the impact from the pandemic, our paper distinguishes the aggregate effect from the national outbreak and the impact from the local outbreak. The empirical results show that the national outbreak of Covid-19 lifts the overall fundraising effort. Oppositely, by applying Difference-in-Difference specifications to capture the causal effect from local outbreak, we find that the local outbreaks of COVID-19 had a negative impact on the charitable fundraising effort. Secondly, the top-down government advocacies encouraged fundraising temporally. Our results survive in various specification checks and robustness checks. Finally, we build a simple microeconomic model to explain the possible mechanism behind our empirical findings.