Dimensions of donation preferences: the structure of peer and income effects

Michalis Drouvelis; Benjamin M. Marx

doi:10.1007/s10683-020-09661-z

Dimensions of donation preferences: the structure of peer and income effects

Michalis Drouvelis, Benjamin M. Marx

Economics

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Abstract

Charitable donations provide positive externalities and can potentially be increased with an understanding of donor preferences. We obtain a uniquely comprehensive characterization of donation motives using an experiment that varies treatments between and within subjects. Donations are increasing in peers’ donations and past subjects’ donations. These and other results suggest a model of heterogeneous beliefs about the social norm for giving. Estimation of such a model reveals substantial heterogeneity in subjects’ beliefs about and adherence to the norm. A simple fundraising strategy increases donations by an estimated 30 percent by exploiting previously unstudied correlations between dimensions of donor preferences.

Original language	English
Pages (from-to)	1-29
Number of pages	29
Journal	Experimental Economics
DOIs	https://doi.org/10.1007/s10683-020-09661-z
Publication status	Published - 26 Jun 2020

Keywords

altruism
charitable
donation
experiment
peer effects
social preferences
warm glow

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Drouvelis_&_Marx_Dimensions_of_donation_preferences_Experimental_Economics_2020
This is a post-peer-review, pre-copyedit version of an article published in Experimental Economics. The final authenticated version is available online at: http://dx.doi.org/10.1007/s10683-020-09661-z
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Cite this

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AB - Charitable donations provide positive externalities and can potentially be increased with an understanding of donor preferences. We obtain a uniquely comprehensive characterization of donation motives using an experiment that varies treatments between and within subjects. Donations are increasing in peers’ donations and past subjects’ donations. These and other results suggest a model of heterogeneous beliefs about the social norm for giving. Estimation of such a model reveals substantial heterogeneity in subjects’ beliefs about and adherence to the norm. A simple fundraising strategy increases donations by an estimated 30 percent by exploiting previously unstudied correlations between dimensions of donor preferences.

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Dimensions of donation preferences: the structure of peer and income effects

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Keywords

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