Do Tuition Fees Crowd Out Donations for Religious Public Goods ?

Davy Hendri

Abstract


The private provision of public goods often is under financial pressure, far from a sufficient amount. The same case also happened for public goods in terms of religious activities, such as the Taman Pendidikan Al-Qur'an (TPA). Besides managed by, TPA's operational's cost born in form of donation (voluntary) by the Muslim residents of those housing estates themselves. One of the strategies to increase collected money for supporting the TPA's operational costs is combining the possibility of donating with a mandatory contribution by imposing an intuition fee.

 

This paper trying to determine the possibility of imposing a fee have an impact on donation amount, therefore might have an impact on housing's resident utility in terms of the usage of TPA's services also. The analysis was done using OLS regression which aggregating all the households level data into 30 housing estate levels in Padang City, West Sumatra, Indonesia, whose consists of 20 households each. Using Lancastrian model, the utility of public goods has an inverse U-shaped relationship between donation and utility.


Keywords


crowding out, tuition fee, donation, religious public good

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