Introduction

Due to the demographic and socio-economic changes, societal needs for multiple and hybrid packages of public service provision have significantly increased in the recent past. Thus, communities are under pressure for making pragmatic inter-sectoral and inter-organizational partnerships and collaboration. At the same time, there is a need to reinvestigate the roles and values of historically and culturally traditional organizations, which have, singularly or collectively, contributed in enhancing or ensuring social welfare.

Civil society in Asia Pacific countries that have geographical and historical linkages with each other has experienced a great transition in the structural, organizational, and institutional development of private-led public service provision, along with changes in their political and socio-economic regimes. Facilitation of this practice has increasingly evolved over the past decades. Although researchers study the common ground of the civil society sector in terms of its organizational structure, relation to stakeholders, and managerial characteristics, each country has own cultural and socio-economic contexts that help create unique and specific characteristics of public service provision. South Korea, after the 1997 East Asian economic crisis, has struggled to determine how to eradicate social instability, achieve robust social and human security, and bridge the widening welfare gaps (Ringen et al. 2011). South Korean civil society has been challenged in its development policy of attempting to ensure simultaneous social and economic progress by boosting the economy with market-oriented competitive capability at both national and regional levels, and taking responsibility for citizens’ social welfare (Ringen et al. 2011). In the case of China, for example, a natural disaster, the 2008 Sichuan earthquake, had a unique impact on the development of civil society at the community level (Shieh and Deng 2011). Thus, there has been an acknowledgment that participation in voluntary and reciprocal activities strengthen civil society, and that classical ways of participation of local residents in voluntary and civic engagement are still important in ensuring post-disaster community resilience. The resulting demographic shifts and state-dominated reconstruction in Sichuan gave rise to questions on how conventional forms and structures of community-based activities and involvement can be reshaped and even transformed for further development of Chinese civil society (Teets 2009). In addition, it has been noted that relations between the state, civil society and specific civil society organizations and groups should be further consolidated within a well-institutionalized system (Teets 2009).

Having experienced economic and natural disaster crises over decades, civil society in the Asia Pacific region is challenged to cope with the dynamics of global and socio-economic climate change, while at the same time developing mature and sustainable practices of public service provision. This situation is more significant in local community-oriented service provision. In this sense, understanding the range of distinct modes of relationship of private-led prosocial commitments to local community welfare may provide a way to reconsider the values to be developed, and help discover the weaknesses and challenges that must be managed.

In Japan, civil society has also been at a crossroads in regenerating and strengthening itself. This paper aims to examine how people supply their own labor and finance privately and voluntarily for this challenge, and the factors that promote individual giving behavior. The paper focuses on giving to local civil society organizations (CSOs), including both traditional and modern emerging associations in order to explore the policy implications inherent in the supply and demand of local public goods involving private initiatives of the local CSOs. Traditional CSOs include neighborhood associations (NHAs) and their associated groups, and the incorporated nonprofit organizations (incorporated NPOs) and volunteer groups are defined as the modern emerging CSOs, details of which are explained in the next section.

This paper is divided into five sections. In this section, we highlight our motivations, and in the next section the situations of Japanese civil society are detailed to clarify our focus and targets. The third section reviews previous research and propose research questions. The fourth section explains our data and empirical analysis. And finally, we discuss our findings and implications to analyze the future of charitable giving to the local CSOs as well as the local CSOs themselves.

Japanese Civil Society at a Crossroads

Japan is one of the most aged societies in the world; the percentage of the population aged 65 or older has reached 23 % according to the 2010 national census (Statistics Bureau, Ministry of Internal Affairs and Communications 2011). Also the projected population over the coming decades shows this proportion will steadily increase, reaching to 33.4 % in 2035 and 39.9 % in 2055 (National Institute of Population and Social Security Research in Japan 2012). Societies are gradually becoming more unique and diverse in terms of demographic composition such as aging and immigration in many countries, and the appearance of social strata and social mobility has been changed under globalized and industrialized societies (Rowland 2009). Japan is also involved in and challenged by such intense social movements along with widening distribution of socio-demographics (Ogawa et al. 2009). The more diverse the socio-demographics and economic status become, the more heterogeneous the demands for public services become. Responding to such social structural changes, the national and local governments have been demanded to provide sufficient social welfare services. However, the government has been facing a long-term budget deficit and higher cost of borrowing. The statistics show that long-term outstanding debt of the local governments has increased constantly over the past two or three decades, exceeding 100 % of the GDP since 1998 (Ministry of Finance 2012). The government budget deficit steadily continues to increase, and public finance in the local government has been limited and far away from a balanced financial model.

Changes in the demographics and local government fiscal situation have resulted in reduced local public goods provision. The Japanese government recently launched a new initiative “New Public Commons”; encouraging and supporting the emergence and finance of the private sector as a public goods provider. Prior to this, in the early 2000s to act in harmony with the international trends of "new public management" and "public private partnership" (Hughes 2012), the Koizumi administration of the Liberal Democratic Party developed a new strategy to stimulate local governments. When the Democratic Party of Japan came to power in 2009, government administration openly took a supportive and amicable attitude toward the nonprofit sector as a key player in the new public sphere. For instance, the government decided to implement a stimulus tax policy, which was proposed in the official report of the round-table meeting of the Cabinet Office of the Government of Japan in 2010 (Cabinet Office of Japan 2012; Yamauchi 2010). Although Japan experienced a change of the governing party again since then, backing to the Liberal Democratic Party that is the dominant political regime all the time after the World War II, the nonprofit sector and civic engagement activities remain fairly recognized and acknowledged to some extent in terms of their roles and social values in sustainable public finance and local social welfare with a common awareness on creating a society sustained through mutual assistance (Cabinet Office of Japan 2013).

In times of social change, civil society has to respond to changing demands on social welfare services in terms of emerging demand heterogeneity as well. In a theoretical sense of political economics, the median voters represent the average and the largest segment of demand for public services, and their preference both for quantity and quality of service provision is acknowledged and considered in the government spending policies. Aforementioned demand heterogeneity along with the social demographic change indicates that the preference and demands of non-median voters can gradually and significantly become considerable. The existing system of public service provision by failing to meet such demands at both regional and individual levels, provides rationale for the formation of citizens’ private and nonprofit activities (Weisbrod 1975). This theoretical assertion can also be confirmed in a practical sense, considering aforementioned hardship and challenges in public spending and structural social dynamics according to demographic transition which also affect the government financial structure. Such situations make it much tougher that the public services are provisioned and financed at sufficient quality and quantity. As a result, the number of incorporated NPOs have steadily increased to work in various fields such as social welfare, social education, local community development, international cooperation, environment, arts and culture, skill development and creating employment opportunity, and so on (Cabinet Office of Japan 2014). While at the same time, these useful incorporated NPOs, especially the community-based organizations, have also been facing difficulties in maintaining the size and stability of their revenues (Yamauchi et al. 2008), and in securing public involvement in the provision of services and taking part in the community activities.

Most of the community-based CSOs in Japan are the NHAs. The NHAs have evolved five structural and organizational distinctions as their central features over time: (1) the NHAs have their own subdivided local areas for administration and activities, and one’s local areas do not overlap with another; (2) the unit of account for the NHA members is a household, not an individual; (3) all the households in an area by default are members of the respective NHA; (4) the NHAs comprehensively address a broad variety of local community issues; and (5) the NHAs are then the representative organizations to the local municipalities and outsider authorities (Nakata 2007). Local community issues such as waste disposal and disaster risk reduction have to be addressed and managed jointly by the local residents in cooperation with their local governments. As a result, the building and functioning of cooperation and partnership with the local government has been one of the central issues in previous research on small government and decentralization. The formation of the new NHAs to meet new demands on local areas has also been discussed (Nakata 2007).

These features of NHAs indicate that the NHAs can work to address not only public issues in a broad sense, but also issues among and within the local member households, and even private issues, given that neighborhoods are social communities with face-to-face interaction among members. Almost all households in most of the areas join the NHAs because they are geographically congruity localized (Pekkanen et al. 2014); and provide the basis of mutual help, and sustainable social welfare among the local community people. In fact, the situation of local communities and the NHAs have gradually changed because of the awareness of global and local issues such as global sustainability, urbanization, and aging societies, and greater commitments from those multiple actors in international and regional communities with capacity to cope with the social issues. Some research works tried to understand the current status of the NHAs, and the proportional participation of local residents measured in terms of the family units. One of these studies (KISER and TDRC 2005) has found that there is a membership gap between rural and urban areas with a higher propensity for membership in rural areas than in urban areas. This indicates that people do not participate in the NHAs as a result of urbanization or migration to the cities.

The membership of the NHAs has also been discussed from juristic perspectives, and the Supreme Court of Japan has ruled in favor of freedom to withdraw from membership of the NHAs (Supreme Court of Japan 2005). Membership fees of the NHAs mostly include expenses for common services, which implicitly means that a household in a local community area cannot avoid involvement in organizing and maintaining that community’s common goods and services. Therefore, in the past there was no way for any household to opt out of the NHAs in the first place. In this sense, the decision of the Supreme Court was notable because the NHA membership no longer could be regarded as compulsory, and participation in community organizations by the local residents cannot be made obligatory citing historical or socio-cultural practices.

Alliance associations of the NHAs such as Rengo Jichikai and Renraku Kyogikai work in broader geographical areas, on the principle that some activities are better organized and run by the joint cooperative work of the NHAs in terms of scale and efficiency. However, some NHAs have also poorly worked within such broader organizations for local community activities, because it became harder for the aging society of those NHAs to deliver their opinions effectively. Other voluntary associations and circle activities also facilitate the networking and engagement of the neighborhood communities. In addition, while the NHAs are intended for the household unit, people also join associated groups of the NHAs, such as senior clubs or associations, women’s associations, children’s associations, fire and flood prevention companies. These associations are also facing difficulty in maintaining membership or surviving at all because of the declining number of the youth in local areas driven by Japanese demographics which shows that the number of youth population (<15 years old), in absolute and percentage terms, has steadily decreased in the last four decades (Statistics Bureau, Ministry of Internal Affairs and Communications 2014c). Also, the outflow of rural population and worker households has been a long-term demographic phenomenon (Statistics Bureau, Ministry of Internal Affairs and Communications 2014b), which is another social demographic factor affecting the survival of these associations.

Nevertheless, the NHAs exist nationwide and are deeply entrenched in each local community, and with the aforementioned five features. However these organizations’ size and activities are self-determined creating a variety in forms and activities across the country. A problem with this situation is that statistics and databases for these associations are not unified or well-constructed. Yutaka Tsujinaka and his colleagues surveyed about 30,000 the NHAs, covering a variety of organizational forms and activities to show the challenges in comprehending the picture of the NHAs, and their relationship to local people or to the local government (Pekkanen et al. 2014).

Conversely, the incorporated NPOs with legal status are now observable and measurable in numbers in terms of size and activities. Figure 1 shows the trends in the numbers of incorporated NPOs since 1999 (the first organization was certified under the NPO Law in December 1998). Although more than 50,000 incorporated NPOs have been certified in the past 16 years, there has been no public record of financial data in digital setting. Only the Center for Nonprofit Research and Information at Osaka University has collected the financial statements of all registered incorporated NPOs to build a database to capture their present financial status (Yamauchi et al. 2007, 2008). Using the fiscal year 2003 dataset of this database, it finds that current revenue of the incorporated NPOs is about $165,020 in average (currency exchange rate of $1 = ¥100 is consistently used hereafter), and the median about $29,210 (Ishida 2008). Considering the fact that most incorporated NPOs carry out community-based activities, most incorporated NPOs are facing financial hardship.

Fig. 1
figure 1

Trends in the numbers of incorporated NPOs. Source: Cabinet Office of Japan (2014)

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The data shows that revenue from charitable giving averages $14,060 and $12,060 from the membership fees making up 9 % and 7 % of total revenues, respectively, while commercial revenue including contracts with the governments made up the largest which accounted for 68 %. Other survey data may show more recent status. The Cabinet Office of Japan has been conducting surveys on the incorporated NPOs and civic social contribution. One of the surveys, the 2013 actual condition survey on the incorporated NPOs with 13,130 responses (response rate is 30 %) describes that, in general, the revenue is made up of charitable giving (5 %), membership fees (3 %), and government subsidies and private grants (17 %). In addition, this survey uncovers that the average annual salary of fulltime staff of the incorporated NPOs is $22,700.

According to the government’s annual household survey, the family income and expenditure survey, around $30 per household (0.08 % of consumption expenditure by household units) has been the average size of giving since 1990 in Japan, except for the years 1995, when the Great Kobe Earthquake hit, and 2011, the year of the Great East Japan Earthquake (Fig. 2). These data include charitable giving in terms of the community chests, Red Cross, the NHAs, excluding donations to educational institutions or religious organizations (Statistics Bureau, Ministry of Internal Affairs and Communications 2010).

Fig. 2
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Trends in the amount of household. Source: Statistics Bureau, Ministry of Internal Affairs and Communications (2014a)

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According to the Central Committee of Community Chests in Japan, amount of donation to community chests has been decreasing, after a peak in 1996 when the amount of money in total was close to $250 million (Central Committee of Community Chests in Japan 2012). This downward trend may be due to the corresponding economic turndown, and suggests that the decrease in household income depresses charitable giving for local social welfare. Considering the fact that door-to-door solicitation is the most popular form of fundraising and the major source of revenue of the community chests, and that such solicitation of fundraising is carried out cooperatively by the neighborhood associations (Nakata 2007), it is conceivable that the decline in membership of the NHAs and the consequent downturn in their activities may have caused the decrease in donations to the community chests. It may, however, be that people now give more to other associations, since the total giving of households is almost stable.

In the past decade, more discussions have been seen among scholars and practitioners on the revenue of the nonprofit sector in Japan (Onishi 2007; Japan Center for International Exchange 2004, 2007), and recently fundraising activities have been heavily paid attention in Japanese civil society (Yamauchi 2014). There is, however, little scientific or evidence-based research. Baba et al. (2010) have contributed one of the few empirical studies on this situation in Japan, and discovered that social support money such as charitable giving, membership fees, and grants can improve the financial stability of incorporated NPOs, while discussions regarding their strategic revenue sources have not been accounted for by the traditional local CSOs, the NHAs. Thus, identifying giving behavior toward the local CSOs has come to be an important issue.

Previous Research and Research Questions

A number of studies have been conducted on individual charitable giving to examine the effects of government expenditures and institutional instruments as a policy incentive on charitable giving in terms of the private provision of public goods on the one hand and donors’ individual characteristics influencing their social and economic behavior on the other. The impacts of giving have been empirically studied by investigating the income or price elasticity of donations to identify effects of tax incentives. Since the study by Taussig (1967), followed by economic commentators such as Feldstein (1975a, b), many studies (e.g., Clotfelter and Salamon 1982; Schiff 1985; Feenberg 1987; Andreoni 1989; Clotfelter 1990; Randolph 1995; Auten et al. 2002; Andreoni et al. 2003) have been conducted on individual giving behavior.

In empirical explorations of individual giving behavior, a considerable volume of research has been carried out analyzing type of causes and recipients, as well as determinants of individual giving by employing disaggregated micro-data. Although the targeted socio-economic class of donors, charitable causes, and countries and regions have been diverse in these studies, some patterns of effects of individual attributes and household compositions on the decision of charitable giving have been elucidated. The studies of socio-economic variables include economic status (Bell and Force 1956; Banks and Tanner 1999; Brooks 2002; Wang and Graddy 2008), income status (Hughes and Luksetich 2008; James and Sharpe 2007), educational attainment (Brown 1999), age (Pharoah and Tanner 1997; Gittell and Tebaldi 2006), marital status (Feldstein and Taylor 1976; Feenberg 1987; Andreoni et al. 2003; Mesch et al. 2006), sex (Kaplan and Hayes 1993; Hodgkinson and Weitzman 1986; Bulcroft et al. 1996; Mesch et al. 2002; Chrenka et al. 2003), social class (Jones and Posnett 1991; McClelland and Brooks 2004), and race and ethnicity (Mesch et al. 2002; Kaplan and Hayes 1993). Besides the physical and social attribute, experience of participation in prosocial activities such as volunteering (Simmon and Emanuele 2004), social norms (Piliavin and Charng 1990; Radley and Kennedy 1995), and perceptional and attitudinal factors such as trust and appreciation of government responsibility (Brooks 2003; Sargeant et al. 2006; Matsunaga 2007) have all been shown to affect giving behavior.

Also the effects of fundraising and outreach efforts of the recipient organizations on the giving behavior have been empirically tested in terms of creating a strategic development pattern for the CSOs, and building relationships with the communities. This is related to the opportunities for CSOs and their relation to individuals. That is, enlightenment of people about the activities and achievements of the NPOs are essential if increased giving is to receive private support (Lee and Farrell 2003; Burgoyne et al. 2005; Wiepking and Maas 2009). Furthermore, system of accountability and governance is critical for the recipient organizations to be competitive by enhancing their reliability (Gordon and Khumawala 1999; Sloan 2009).

As noted above, previous empirical research has elucidated a variety of factors and incentives relating to giving behavior. However, there is still a question of whether the factors and motives of individuals can be the ones affecting the decisions relating to private provision of “their” local public goods and services of which they can be also beneficiaries. In the context of private initiatives in community design and regeneration, private provision of local public goods to meet the quality and quantity demanded by local residents themselves is a key in securing unique and sustainable supply routes for local public goods and services.

This study focuses on two types of civil society organizations that hold a unique and important position in relation to charitable giving. One is the traditional local CSO, including the NHAs, which have had a tremendous effect on community building and associated activities (Haddad 2004; Pekkanen 2006), involving more than 90 % of the residential membership in each neighborhood community in Japan. The other is the newly emerged incorporated NPOs (since the enactment of the NPO Law in 1998) numbering over 50,000. These two types of local CSOs have many different characteristics, but both have the same problems regarding social understanding, participation, and revenue. Thus, it is worth examining and identifying the philanthropic behavior of local residents toward both types of local CSOs to develop local societies, and in learning lessons related to supporting nonprofit activities in providing local social welfare services.

Data and Empirical Analysis

We conducted a mail survey of 2100 individuals sampled randomly from the official voters’ lists and residential maps in Hyogo prefecture, Japan, where there is a range of urban, suburban, and rural areas among 41 cities and towns. Japanese Local Autonomy Law specifies three types of cities based on population size; cabinet order-specified cities (Seirei Shitei Toshi, basically population of above 800 thousand), pivotal cities (Chukakushi, above 300 thousand), and special-case cities (Tokureishi, above 200 thousand). Each of these city types contain administrative and industry structural features considered important for the shape and setting of local welfare provision. Hyogo, a unique prefecture in Japan, encompasses all these types of specified cities such as city of Kobe (population of over 1.5 million, the capital city of Hyogo), the second largest Himeji (543 thousand, the second largest, the central city in west side of Hyogo and famous its castle), Nishinomiya (480 thousand, the third, where several universities are located), Amagasaki (467 thousand, the fourth, with many factories, next to Osaka city) as well as smaller cities and towns (the smallest town has population of 12 thousand). Considering the specific characteristics and states of local public service provision and providers in Japan, the questions in the survey were carefully designed in order to elicit the modes of civic engagement holistically, and obtain information on the perception of such bodies and their participation in local public service provision. We received 672 responses, a response rate of 32 %. This project was supported by a research grant from the Foundation for Promoting Workers Welfare and Mutual aid Insurance in Tokyo, Japan, from November 2009 to October 2010.

The questionnaire result finds out that 63 % of people give to some kinds of local civil society and public benefit organizations including the NHAs, incorporated NPOs, social welfare councils, and community chests (Table 1), and a further 38 % give to these organizations outside their town during the last 12 months. It also shows that a half of the respondents give to the NHAs, besides that only 13 % of them give to the incorporated NPOs. In addition, Table 1 illustrates descriptive statistics of the independent variables embraced in the estimations that have been discussed in the previous studies including the personal attributes, experiences, and perceptions regarding civil society and institutions.

Table 1 Descriptive statistics of variables in the estimation models
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Table 2 shows the estimation results using the Probit model to explore factors influencing the inclination to give to the local civil society and public benefit organizations. Tables 3 and 4 also show the results of Probit model analysis on giving trends, who donates to the local civil society organizations, especially the NHAs and the incorporated NPOs, respectively.

Table 2 Estimation results from the Probit model “Who gives to local CSOs?”
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Table 3 Estimation results from the Probit model “Who gives to the NHAs?”
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Table 4 Estimation results from the Probit model “Who gives to incorporated NPOs?”
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According to Table 2, Sex has explanatory power on the probability to give to local CSOs in positive, which means that female gives more than male. Age is also statistically and positively significant, but the sign of its squared value is negative and marginal effect is close to zero, which means that the probability to give increases with age and decreases quite gradually after reaching a certain age. Marriage and Children are not statistically significant. House affects positively which indicates that people who live in the house they own give in higher probability. Variables representing the city size, Cabinet order-specified city and Pivotal/special-case city are not statistically significant. It indicates that the estimation result does not find contextual effects of the city size. Regarding participation in volunteer activities, the probability of giving is higher among those who have participated in volunteer activities in local areas, regardless of the frequency of their participation. The probability of giving by those who have experience of volunteer participation is around 16 % higher than those who do not. The respondents’ own and family experience of receiving welfare services (experience to receive welfare services) is considered as a proxy of knowledge about current status of the welfare services’ provision, and it is not statistically significant. Regarding the perception of local attachment, civic norm, and public service provider, the marginal effects of local attachment and enthusiasm in volunteering for their local societies have positive and significant impacts on the decision to give, however interest in volunteering for any society in general as a proxy of civic norm, is not statistically significant. Also, interest in national and local governments is not significant either.

Statistically significant variables are notably different when looking at the estimation results of the inclination to give to the NHAs (Table 3) and to the incorporated NPOs (Table 4). With respect to socio-demographic traits, Sex is significant in the incorporated NPOs estimations, whereas it is not with respect to the NHAs. Women give more to the incorporated NPOs than men, however there is no gender difference in the decision to give to the NHAs. It indicates that women are associated more with new type of local organizations rather than traditional and residential house-based organizations. On the other hand, Age is only significant and has explanatory power on the probability to give to the NHAs. Currently in most of the NHAs, elders who retired manage to run their NHAs. The elders tend to join the NHAs with more commitment and responsibility. Marriage is significant only in the NHAs models. Perhaps single men and women usually rent apartments and do not associate with any NHA. Thus, they do not have any familiarity with activities of the NHAs and were not asked of their contributions. Children does not have explanatory power for both the incorporated NPOs and the NHAs estimations. House is the only variable that is significant in both models, but its marginal effects are comparatively different. The effects to probability for giving to the NHAs are about 6 % higher than giving to the incorporated NPOs. Owning a house illustrates a perspective of social relational and structural embeddedness in communities they live because people need to pay relatively high cost to move out. Thereby, people may feel more attached to their residential blocks and be concerned about trying to make themselves a good resident to make their blocks better. Similar to the explanation for single, people who own their house usually tend to join the NHAs and may be asked of their contributions. House ownership describes socio-economic status as well. The city size (the cabinet order-specified city and pivotal/special-case city), though was expected to show contextual effect, is not statistically significant in any of the estimations of the NHAs and incorporated NPOs.

Regarding social involvement, both regular and irregular participation in volunteer activities in local area have fairly strong explanatory power on the probability to give to the NHAs, whereas only irregular participation is statistically significant on giving to incorporated NPOs with smaller marginal effects comparing to the NHA models. It seems that the frequency of participation in volunteer activities may be a matter of deciding the probabiltiy to give to the incorporated NPOs models. These results may reflect the point that the incorporated NPOs and their activities are relatively new, and they offer more irregular volunteer activities.

Finally, variables representing perceptions including local attachment, civic norm, and public service providers show some explanatory power in relation to the probability of giving to both the NHAs and the incorporated NPOs. Local attachment and interest and enthusiasm in volunteering for local society are significant for both, and it is quite natural to understand that people who volunteer for their community give to the local organizations. The variable of interest and enthusiasm in volunteering for societies in general, which may imply civic norm in social capital discussion, is not significant for local charitable giving to any types of organizations. Concerning the providers, not surprisingly, people who are interested in the NHAs have propensities to give to the NHAs, and in the same way people who are interested in the NPOs in general tend to give to the incorporated NPOs. At last, interest in national government is significant only for the incorporated NPOs model, and local government is insignificant for both models. The results may indicate that these two variables are not proxy of attitudes toward considering public goods and services, but more like reflecting interest in political trends.

Discussions and Conclusion

This study empirically examines giving behavior to the local CSOs in Japan such as the NHAs and incorporated NPOs engaging in improvement of local social welfare as local public goods, and facing financial problems at the same time. The findings have several policy implications to promote individual charitable giving to support the local CSOs.

Many studies all over the world reveal individual giving behavior, and previous research on the revenue trends of the incorporated NPOs have found that people in Japan give to activities such as health promotions, international aid, arts, music and sports, and so on (Ishida 2008; Yamauchi et al. 2008). However, no paper has focused on giving behavior of local residents to the local organizations in any countries. Thus, this paper examines the factors influencing individual giving behavior toward the local CSOs using the original survey data. It focuses on who gives to what types of the CSOs, especially those locally-based or oriented organizations that contribute to the improvement of local social welfare. The results show that around 63 % of the community inhabitants give to the local CSOs, and 49 % and 13 % give to the NHAs and incorporated NPOs, respectively.

We find several statistically significant variables in the estimation results. These indicate that those who are female, elder, own a house, and participates in volunteer activity have a higher probability of giving to the local CSOs in general, as previous studies of giving behavior have shown. On the other hand, marriage, having children, and household income are not explanatory factors affecting individual giving behavior to the local CSOs.

This study also focuses to consider the unit of local society, so estimation models contain the features and awareness of their living area as an explanatory variable for the behavior of respondents. However, the effect that those who lives in smaller-size city has a higher probability of giving to local CSOs was not observed in any of estimation results. The factors of interest and enthusiasm in the activities of volunteering in local society may promote contributing behaviors to the local CSOs, or the NHAs and the incorporated NPOs. Furthermore, respondents were asked to reveal how they thought of the local CSOs in the survey. In the same way, there are a considerable number of critical comments in the survey that point out the lack in transparency of organizational activities that results in distrust as well as less sympathy and understanding. Thus, many people do not have faith in the local CSOs.

The estimation results of the NHAs and incorporated NPOs show several different factors influencing the giving behavior on each recipient organization. Age, marriage, house ownership, and regular and irregular participation in volunteer activities are significant variables in the NHAs model, whereas marriage and regular participation are not significant in the incorporated NPOs model. In addition, the incorporated NPOs model shows that a variable of the interest in national government and public administration affects positively, which may bespeak that attributes are different and various according to which people give, the NHAs or the incorporated NPOs.

Based on the estimation results and additional hundreds of comments from the respondents, three policy implications are derived. First, it is natural to find the relationships between awareness of local society and charitable giving behavior. With this finding some possible ways to promote individual giving may be expected. These days more people in Japan have become more concerned about the devlopment of their local society and community, and have tried to involve others towards achieving sustainable development. This trend should drive an increase in number of people who are interested in and participate in activities for their local societies seeing local welfare services as local public goods, over time, and persuading people to start or increase giving to support and raise local social welfare. In other words, this may be proposed as a local management strategy that is not just asking for more giving as a direct approach to raise revenue, but will also to draw public attention to the need to participate in the activities as an indirect approach to social welfare.

Second, in building a scheme to encourage people to participate in volunteer activities following the obtained estimation results of this study, we now know that those who do volunteer work tend also to give. The government and civil society sector have been expecting the newly retired elders of the baby-boom generation to participate in volunteering in their second life stage, but without success. Several previous studies have examined this problem, and found that these elders did not know how to start volunteering because of a lack of social networks in their local society, and that those elders who try to join such activities do not get along with the organizations they join (JILPT 2012). To solve this problem, a matching scheme for potential volunteers and organizations is needed in each local society.

Third, a scheme to improve disclosure of the affairs of the local CSOs as well as to open information of these organizations to the public needs to be constructed. The NHAs are traditional associations that are based on the household unit, and still have close to 100 % membership in many local societies, so every household should be able to recognize their being and activities. The NHAs such as Jichikai and Chonaikai have been building social networks in neighborhood through circulating notices or bulletins, or holding events such as local art or sports festivals. People in these communities, however, are losing their interest in taking part in the governance of these associations because their organizational structure has been vertical and has become immobile and opaque. Therefore, the NHAs need to change their methods of governance to be flexible enough to draw local attention and engagement. In this regard, some local governments have changed the way of subsidizing the NHAs to give the active ones an incentive to continue.

Conversely, the incorporated NPOs are relatively new and are relatively known to the public. In fact, as seen in Fig. 1, the number of the incorporated NPOs has grown, but few people know where they work, or what their goals are, because most of these organizations locate in larger cities, and their activities are not always related to every household like those of the NHAs. The incorporated NPOs need to be seen as effective and trustworthy entities by making known their missions, activities, financial status, and other important features to the public. Currently more organizations are trying to inform people of their features, but the efforts of a single organization are generally not enough, in particular due to the fact that most of these organizations do not have enough resources to spread their message. At this time, the intermediary organizations, governments, or other public organizations are expected to play the role of developers of the subsector of nonprofits. Indeed, the governments and some intermediary NPOs have constructed a database to open this information to the public of Japan. These organizations, however, have failed to provide enough information about increasing number of organizations to the potential donors to evaluate the incorporated NPOs. In other words, there is very little opportunity for the donors to consider and empathize with organizations they might want to give to if they knew about them.

In recent years, it has been noticeable that a hybrid type organization like the NHAs and incorporated NPOs, or a weak network of these organizations, has developed in some areas to achieve the providing local social welfare services (KISER and TDRC 2005). There are some like the NHAs that establish incorporated NPOs, in which households in the community are the member in principle, as a revitalizing measure (Oizumi 2005; Mori and Niikawa 2013). The NHA consists of residents in a designated area, so they have higher ability to address the problems and difficulties in their local community and carry out drastic changes because of a long period of positive neighborhood relations. The incorporated NPOs can assist the NHAs coping with their affairs in this situation (Nakata 2007), because they are able to remove the intensity of inter-personal relations found in the NHA environment. This sort of multi-layered structure or network of place-oriented and purpose-oriented entities can be expected to achieve better local governance and provide local public goods by promoting charitable giving from the enlightened residents.