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Toward an Understanding of the Economics of Charity: Evidence from a Field Experiment

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Author Info
Craig Landry
Andreas Lange
John A. List
Michael K. Price
Nicholas G. Rupp

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Abstract

This study develops theory and uses a door-to-door fundraising field experiment to explore the economics of charity. We approached nearly 5000 households, randomly divided into four experimental treatments, to shed light on key issues on the demand side of charitable fundraising. Empirical results are in line with our theory: in gross terms, our lottery treatments raised considerably more money than our voluntary contributions treatments. Interestingly, we find that a one standard deviation increase in female solicitor physical attractiveness is similar to that of the lottery incentive¡ªthe magnitude of the estimated difference in gifts is roughly equivalent to the treatment effect of moving from our theoretically most attractive approach (lotteries) to our least attractive approach (voluntary contributions).

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 11611.

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Date of creation: Sep 2005
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Handle: RePEc:nbr:nberwo:11611

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Find related papers by JEL classification:
C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
L30 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - General

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  10. Andreas Lange & John A. List & Michael K. Price, 2007. "Using Lotteries To Finance Public Goods: Theory And Experimental Evidence," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 48(3), pages 901-927, 08. [Downloadable!] (restricted)
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  20. Edward L. Glaeser & David I. Laibson & José A. Scheinkman & Christine L. Soutter, 2000. "Measuring Trust," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 811-846, August. [Downloadable!] (restricted)
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    Other versions:
  22. Fraser, Cynthia & Hite, Robert E & Sauer, Paul L, 1988. " Increasing Contributions in Solicitation Campaigns: The Use of Large and Small Anchorpoints," Journal of Consumer Research: An Interdisciplinary Quarterly, University of Chicago Press, vol. 15(2), pages 284-87, September.
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