Advanced Search
MyIDEAS: Login to save this article or follow this journal

Transactions Costs in Charitable Giving: Evidence from Two Field Experiments

Contents:

Author Info

  • Huck Steffen

    ()
    (University College London)

  • Rasul Imran

    ()
    (University College London)

Abstract

In large-scale fundraising campaigns based on direct mailings, typically less than 5% of individuals donate to the charitable cause. We present evidence from two field experiments designed to measure the existence of transaction costs that inhibit charitable giving in such fundraising campaigns, and shed light on the nature of such transaction costs. The experiments are designed in conjunction with the Bavarian State Opera House. The first mail-out experiment was implemented over two stages using a within-subject design. We develop a theoretical framework that makes precise the identifying assumptions under which we can exploit this two-stage design to measure the following structural parameters among potential donors: (i) the share of donors who would make a strictly positive donation in the complete absence of transaction costs and (ii) the probability that a potential donor has sufficiently low transactions costs to make a strictly positive donation. Our results imply response rates to mail-out solicitations would almost double in the complete absence of transaction costs. The second field experiment provides more evidence on the nature of transaction costs. We distinguish between ex ante transaction costs, which prevent the choice problem from being considered and ex post transaction costs, which prevent choices being implemented. We find that the likelihood of a donation being made increases by 26% in response to even a small reduction in ex post transaction costs.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.degruyter.com/view/j/bejeap.2010.10.1/bejeap.2010.10.1.2494/bejeap.2010.10.1.2494.xml?format=INT
Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by De Gruyter in its journal The B.E. Journal of Economic Analysis & Policy.

Volume (Year): 10 (2010)
Issue (Month): 1 (April)
Pages: 1-35

as in new window
Handle: RePEc:bpj:bejeap:v:10:y:2010:i:1:n:31

Contact details of provider:
Web page: http://www.degruyter.com

Order Information:
Web: http://www.degruyter.com/view/j/bejeap

Related research

Keywords:

References

No references listed on IDEAS
You can help add them by filling out this form.

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Fehrler, Sebastian & Kosfeld, Michael, 2012. "Pro-Social Missions and Worker Motivation: An Experimental Study," IZA Discussion Papers 6460, Institute for the Study of Labor (IZA).
  2. Robert Dur & Robin Zoutenbier, 2012. "Intrinsic Motivations of Public Sector Employees: Evidence for Germany," Tinbergen Institute Discussion Papers 12-135/VII, Tinbergen Institute, revised 02 Jun 2014.
  3. Huck, Steffen & Rasul, Imran, 2011. "Matched fundraising: Evidence from a natural field experiment," Journal of Public Economics, Elsevier, vol. 95(5-6), pages 351-362, June.
  4. Gerlinde Fellner & Rupert Sausgruber & Christian Traxler, 2009. "Testing Enforcement Strategies in the Field: Legal Threat, Moral Appeal and Social Information," Working Paper Series of the Max Planck Institute for Research on Collective Goods 2009_31, Max Planck Institute for Research on Collective Goods.
  5. Jose Apesteguia & Patricia Funk and Nagore Iriberri, 2010. "Promoting Rule Compliance in Daily-Life: Evidence from a Randomized Field Experiment in the Public Libraries of Barcelona," Working Papers 492, Barcelona Graduate School of Economics.
  6. Stephen Knowles & Maros Servatka, 2014. "Transaction Costs, the Opportunity Cost of Time and Inertia in Charitable Giving," Working Papers 1401, University of Otago, Department of Economics, revised Jan 2014.
  7. Jonathan Meer & Oren Rigbi, 2012. "Transactions Costs and Social Distance in Philanthropy: Evidence from a Field Experiment," Working Papers 1205, Ben-Gurion University of the Negev, Department of Economics.
  8. Axel Sonntag & Daniel John Zizzo, 2014. "Reminders, payment method and charitable giving: evidence from an online experiment," Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) 14-04, School of Economics, University of East Anglia, Norwich, UK..
  9. Robert Dur & Robin Zoutenbier, 2012. "Intrinsic Motivations of Public Sector Employees: Evidence for Germany," Tinbergen Institute Discussion Papers 12-135/VII, Tinbergen Institute, revised 02 Jun 2014.
  10. Huck, Steffen & Rasul, Imran & Shephard, Andrew, 2013. "Comparing Charitable Fundraising Schemes: Evidence from a Natural Field Experiment and a Structural Model," CEPR Discussion Papers 9648, C.E.P.R. Discussion Papers.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:bpj:bejeap:v:10:y:2010:i:1:n:31. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Golla).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.