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Is a Donor in Hand Better Than Two in the Bush? Evidence from a Natural Field Experiment

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  • Craig E. Landry
  • Andreas Lange
  • John A. List
  • Michael K. Price
  • Nicholas G. Rupp

Abstract

This study examines why people initially give to charities, why they remain committed to the cause, and what factors attenuate these influences. Using an experimental design that links donations across distinct treatments separated in time, we present several results. For example, previous donors are more likely to give, and contribute more, than other donor types. Yet, how previous donors were acquired is critical: agents initially attracted by an economic mechanism are more likely to continue giving than agents attracted by a nonmechanism factor. From a methodological viewpoint, our study showcases the benefit of moving beyond an experimental design that focuses on short-run substitution effects. (JEL C93, D64, D82, H41, L31, Z12)

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Bibliographic Info

Article provided by American Economic Association in its journal American Economic Review.

Volume (Year): 100 (2010)
Issue (Month): 3 (June)
Pages: 958-83

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Handle: RePEc:aea:aecrev:v:100:y:2010:i:3:p:958-83

Note: DOI: 10.1257/aer.100.3.958
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References

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  1. Jeff E. Biddle & Daniel S. Hamermesh, 1995. "Beauty, Productivity and Discrimination: Lawyers' Looks and Lucre," NBER Working Papers 5366, National Bureau of Economic Research, Inc.
  2. Craig Landry & Andreas Lange & John List & Michael Price & Nicholas Rupp, 2006. "Toward an understanding of the economics of charity: Evidence from a field experiment," Natural Field Experiments 00292, The Field Experiments Website.
  3. Morgan, John, 2000. "Financing Public Goods by Means of Lotteries," Review of Economic Studies, Wiley Blackwell, vol. 67(4), pages 761-84, October.
  4. Stephan Meier, 2006. "Do subsidies increase charitable giving in the long run?: matching donations in a field experiment," Working Papers 06-18, Federal Reserve Bank of Boston.
  5. Uri Gneezy & John A List, 2006. "Putting Behavioral Economics to Work: Testing for Gift Exchange in Labor Markets Using Field Experiments," Econometrica, Econometric Society, vol. 74(5), pages 1365-1384, 09.
  6. Hirshleifer, Jack, 1987. "Economic Behaviour in Adversity," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226342825, March.
  7. Charles T. Clotfelter, 1985. "Federal Tax Policy and Charitable Giving," NBER Books, National Bureau of Economic Research, Inc, number clot85-1.
  8. Dean Karlan & John A. List, 2006. "Does Price Matter in Charitable Giving? Evidence from a Large-Scale Natural Field Experiment," Working Papers 1, The Field Experiments Website.
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  11. Douty, Christopher M, 1972. "Disasters and Charity: Some Aspects of Cooperative Economic Behavior," American Economic Review, American Economic Association, vol. 62(4), pages 580-90, September.
  12. Morgan, John & Sefton, Martin, 2000. "Funding Public Goods with Lotteries: Experimental Evidence," Review of Economic Studies, Wiley Blackwell, vol. 67(4), pages 785-810, October.
  13. Andreas Lange & John List & Michael Price, 2007. "Using lotteries to finance public goods: theory and experimental evidence," Artefactual Field Experiments 00381, The Field Experiments Website.
  14. Vesterlund, Lise, 2003. "The informational value of sequential fundraising," Journal of Public Economics, Elsevier, vol. 87(3-4), pages 627-657, March.
  15. John A. List & David Lucking-Reiley, 2000. "The Effects of Seed Money and Refunds on Charitable Giving: Experimental Evidence from a University Capital Campaign," Vanderbilt University Department of Economics Working Papers 0008, Vanderbilt University Department of Economics.
  16. Chen Yan & Li Xin & MacKie-Mason Jeffrey K, 2005. "Online Fund-Raising Mechanisms: A Field Experiment," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 5(2), pages 1-39, December.
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  18. Yan Chen & Xin Li & Jeffrey MacKie-Mason, 2006. "Online fund-raising mechanisms: A field experiment," Natural Field Experiments 00225, The Field Experiments Website.
  19. Steven D. Levitt & John A. List, 2007. "What Do Laboratory Experiments Measuring Social Preferences Reveal About the Real World?," Journal of Economic Perspectives, American Economic Association, vol. 21(2), pages 153-174, Spring.
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  23. Andreoni, James, 1990. "Impure Altruism and Donations to Public Goods: A Theory of Warm-Glow Giving?," Economic Journal, Royal Economic Society, vol. 100(401), pages 464-77, June.
  24. Clotfelter, Charles T., 1985. "Federal Tax Policy and Charitable Giving," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226110486.
  25. John A. List, 2007. "On the Interpretation of Giving in Dictator Games," Journal of Political Economy, University of Chicago Press, vol. 115, pages 482-493.
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Citations

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Cited by:
  1. Dean Karlan and John A. List, 2012. "How Can Bill and Melinda Gates Increase Other People’s Donations to Fund Public Goods? - Working Paper 292," Working Papers 292, Center for Global Development.
  2. Craig E. Landry & Andreas Lange & John A. List & Michael K. Price & Nicholas G. Rupp, 2011. "The Hidden Benefits of Control: Evidence from a Natural Field Experiment," NBER Working Papers 17473, National Bureau of Economic Research, Inc.
  3. Dean Karlan & John A List, 2012. "How Can Bill and Melinda Gates Increase Other People’s Donations to Fund Public Goods?," Working Papers id:4880, eSocialSciences.
  4. Sieg, Holger & Zhang, Jipeng, 2012. "The importance of managerial capacity in fundraising: Evidence from land conservation charities," International Journal of Industrial Organization, Elsevier, vol. 30(6), pages 724-734.
  5. Thomas Mayer, 2012. "Ziliak and McClosky’s Criticisms of Significance Tests: A Damage Assessment," Working Papers 126, University of California, Davis, Department of Economics.
  6. Craig E. Landry & Andreas Lange & John A. List & Michael K. Price & Nicholas G. Rupp, 2011. "Is There a 'Hidden Cost of Control' in Naturally-Occurring Markets? Evidence from a Natural Field Experiment," NBER Working Papers 17472, National Bureau of Economic Research, Inc.

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