These types of intermediate goods purchases and capital investments, already captured in the NIPAs, also should be included in any new satellite account that aggregates nonprofit sector activities. In addition, it is important to include in the satellite account information on government and nonprofit inputs that are not purchased in markets and, thus, not counted in the NIPAs. Examples include pharmaceuticals given by manufacturers to government and nonprofit health programs, groceries supplied for free or at reduced cost to soup kitchens, food provided by restaurants to volunteers who are donating their time, and computer hardware donated to schools. Most of these same goods are also sold in private markets and so, though they are unmeasured in the NIPAs, in principle they have observable prices. These prices may or may not provide a good indication of the value of items that have been donated. Consider, for example, donations of computer hardware or software to a school or donations of pharmaceuticals to a nonprofit health clinic. It would be questionable to value such donations at the prices at which the school or the clinic could have, but did not, buy the products. The observed market prices would probably overstate the recipient’s willingness (and ability) to pay. Nonetheless, satellite accounts that include in-kind donations to government and nonprofit organizations could shed light on currently unmeasured economic inputs.
Recommendation 7.2: Donations of labor and goods to government and nonprofit organizations should be characterized and described in quantitative terms, and approaches based on market comarisons should be developed for estimating their value as inputs.
Because some donated goods are first purchased in markets, the corresponding links with and effects on the NIPAs should be documented.
Volunteer labor is the principal input to government- and nonprofit-sector activities that goes unmeasured in the NIPAs. There is considerable variation in measures of volunteer activity across surveys. Bureau of Labor Statistics (BLS) data from a supplement to the Current Population Survey (CPS) indicate that about 63.8 million people (age 16 and older) performed volunteer work from September 2002 to September 2003 in the United States. This translates into a volunteer rate of 28.8 percent among the civilian noninstitutionalized population. The median amount of time that people reported spending in volunteer activity for the period was 52 hours per year. For this work, volunteers are defined as “persons who did unpaid work (except for expenses) through or for an organization” (U.S. Bureau of Labor Statistics, 2003). Independent Sector and the Urban Institute (2004), based on data from their 2001 Giving and Volunteering Survey, report that 83.9 million Americans (age 18 and older) volunteered in 2000 (a volunteer rate of 44 percent), contributing an average of 3.6 hours a week, figures