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TESTING FOR ALTRUISM AND SOCIAL PRESSURE IN CHARITABLE GIVING
Every year, 90% of Americans give money to charities. Is such generosity necessarily welfare enhancing for the giver? We present a theoretical framework that distinguishes two types of motivation: individuals like to give, for example, due to altruism or warm glow, and individuals would rather not give but dislike saying no, for example, due to social pressure. We design a door-to-door fund-raiser in which some households are informed about the exact time of solicitation with a flyer on their doorknobs. Thus, they can seek or avoid the fund-raiser. We find that the flyer reduces the share of households opening the door by 9% to 25% and, if the flyer allows checking a Do Not Disturb box, reduces giving by 28% to 42%. The latter decrease is concentrated among donations smaller than $10. These findings suggest that social pressure is an important determinant of doorto-door giving. Combining data from this and a complementary field experiment, we structurally estimate the model. The estimated social pressure cost of saying no to a solicitor is $ 3.80 for an in-state charity and $1.40 for an out-of-state charity. Our welfare calculations suggest that our door-to-door fund-raising campaigns on average lower the utility of the potential donors.
Journal Article
Virtual reality as a tool for environmental conservation and fundraising
Anecdotal evidence from philanthropic fundraisers shows that virtual reality (VR) technology increases empathy and can influence people toward pro-environmental behavior. Non-profit organizations are increasingly marketing their causes using virtual reality and they report increased donations when VR technology is employed. In VR, users are immersed in situations intended to feel more like the real world through technology, such as 360° video viewed through 3D headsets that block out visual and auditory distractions. The framing of the message as either positive or negative has long shown to have an effect on behavior, although consensus on the impact of framing has not been reached in relation to encouraging contributions to public goods. This paper focuses on field experiments used to investigate the effects of varying degrees of visual immersion and positive versus negative message framing on respondents' contributions to a conservation charity. Participants were exposed to a five-minute underwater film about coral reefs and the importance of protecting them. We employed a 2x2 experimental design using 3D head-mounted displays comparing 360° film footage vs. unidirectional film and a positive message vs. a negative message. After watching the film, each participant completed a short questionnaire and had the opportunity to donate to a marine conservation charity. In addition, we tested a control treatment where no video was observed. The video was filmed in Indonesia which is host to some of the world's most biodiverse reefs that are under great threat from human activity. We also conducted the study in Indonesia, sampling a total of 1006 participants from the Bogor city area and tourists on the island of Gili Trawangan-which is popular for scuba diving and snorkeling. We find significant differences in observed behavior and reported emotions between all treatments compared to the control condition. Among the tourist sample, we find significant differences between the 360° film with a negative message which garnered significantly larger average donation amounts compared to the unidirectional film with both positive and negative framing. Overall, we can infer from these studies that virtual reality is an effective way to raise awareness of environmental threats and encourage behavioral action, especially when tailored to target groups. New technology, such as the VR head-mounted display, is highly effective at attracting interest which is an important point to encourage organizations to invest in new technologies.
Journal Article
Great fundraising organizations : why and how the world's best charities excel at raising money
\"They don't have the money. They don't have the money because they don't know how to raise money. Yet there are Great Fundraising Organizations (GFOs) that do know how. Data Clayton has gathered over twenty years of work with more than 500 organizations shows exactly what works. In this book Alan Clayton teaches the proven, rigorously researched mindsets, strategies, and practices of GFOs so that charities worldwide can scale their fundraising and their effectiveness. This book unlocks an organization's potential to meaningfully change the world by showing how to build and lead a Great Fundraising Organization, with a particular focus on leading financials, leading people, and leading communications. It is about how to make the world a better place, faster\"-- Provided by publisher.
BOOK
Unit Asking: A Method to Boost Donations and Beyond
The solicitation of charitable donations costs billions of dollars annually. Here, we introduce a virtually costless method for boosting charitable donations to a group of needy persons: merely asking donors to indicate a hypothetical amount for helping one of the needy persons before asking donors to decide how much to donate for all of the needy persons. We demonstrated, in both real fund-raisers and scenario-based research, that this simple unit-asking method greatly increases donations for the group of needy persons. Different from phenomena such as the foot-in-the-door and identifiable-victim effects, the unit-asking effect arises because donors are initially scope insensitive and subsequently scope consistent. The method applies to both traditional paper-based fund-raisers and increasingly popular Web-based fund-raisers and has implications for domains other than fund-raisers, such as auctions and budget proposals. Our research suggests that a subtle manipulation based on psychological science can generate a substantial effect in real life.
Journal Article
Crowdfunding intelligence : the no-nonsense guide to raising investment funds on the Internet
\"Crowdfunding's time has arrived! Through the power of the Internet, it represents one of the most exhilarating ways to raise investment funds for your dream project. It enables you to get exposure in the public domain and can mean a seal of approval being given to your ideas by the masses. Developed from crowdsourcing - where people get together to generate ideas and solve problems - crowdfunding is an extension of this, only now the crowd add money (funding) to a project. It offers investment solutions to project needs in all sorts of fields, from apps to zoos. This book provides unrivalled explanations and frameworks to help any entrepreneur or business to prepare and execute a successful crowdfunding campaign and raise the capital they need. It contains expert insights and advice from the major players in the sector, including the leading crowdfunding sites, on how success can be achieved.\"--Amazon website.
Book
Toward an Optimal Donation Solicitation: Evidence from the Field of the Differential Influence of Donor-Related and Organization-Related Information on Donation Choice and Amount
The present research decomposes consumer donation behavior into two components: donation choice (i.e., whether to donate) and donation amount (i.e., how much to donate). It then considers how information related to the donor and information related to characteristics of the soliciting organization may differentially influence the two decisions. Results from four field experiments suggest that donor-related appeals have a greater effect on the donation choice decision (vs. organization-related appeals), whereas organization-related appeals have a greater effect on the donation amount decision (vs. donor-related appeals). This might lead one to conclude that presenting both types of appeals in a solicitation is ideal. However, the studies presented herein also suggest that this strategy may backfire. The simultaneous presentation of donor- and organization-related appeals can hamper both donation response rates and average contribution amounts. To address this issue, the authors identify and test an alternative solicitation strategy for maximizing solicitation effectiveness. This strategy involves a multistep request process that capitalizes on an understanding of the differential influence of donor- and organization-related information on donation choice and amount decisions.
Journal Article
Peer Effects in Charitable Giving: Evidence from the (Running) Field
There is a widespread belief that peer effects are important in charitable giving but little evidence on how donors respond to their peers. Analysing a unique data set of donations to online fund-raising pages, we find positive and sizeable peer effects: a £10 increase in the mean of past donations increases giving by £2.50, on average. Donations respond to both very large and very small amounts and to changes in the mode. We find little evidence that donations signal charity quality – our preferred explanation is that donors use information on earlier donations to decide what is appropriate for them to give.
Journal Article