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The completion effect in charitable crowdfunding

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  • Argo, Nichole
  • Klinowski, David
  • Krishnamurti, Tamar
  • Smith, Sarah

Abstract

We analyze data from two charitable crowdfunding platforms and find that donors make significantly larger donations, more frequently, and at a faster pace, in order to personally reach fundraising targets. This ‘completion effect’ occurs even when the target is of no consequence for provision, and even within donors who make multiple contributions on a platform. While the majority of donors follow suggested gift amounts at other points of the campaign, they deviate upwards in order to personally reach targets. We provide evidence that the effect is not driven by uncertainty about the recipient's ability to reach the fundraising goal; rather, it appears to be driven by a private benefit to the donor from personally completing campaigns.

Suggested Citation

  • Argo, Nichole & Klinowski, David & Krishnamurti, Tamar & Smith, Sarah, 2020. "The completion effect in charitable crowdfunding," Journal of Economic Behavior & Organization, Elsevier, vol. 172(C), pages 17-32.
    • Handle: RePEc:eee:jeborg:v:172:y:2020:i:c:p:17-32
    DOI: 10.1016/j.jebo.2020.01.025
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    References listed on IDEAS

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    Cited by:

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    2. Luca Corazzini & Christopher Cotton & Enrico Longo & Tommaso Reggiani, 2021. "The Gates Effect in Public Goods Experiments: How Donations Flow to the Recipients Favored by the Wealthy," MUNI ECON Working Papers 2021-13, Masaryk University, revised Feb 2023.
    3. Anton Miglo, 2022. "Theories of Crowdfunding and Token Issues: A Review," JRFM, MDPI, vol. 15(5), pages 1-28, May.
    4. Luca Corazzini & Christopher Cotton & Enrico Longo & Tommaso Reggiani, 2022. "Pro-Rich and Progressive: Policy Selection and Contributions in Threshold Public Goods Experiments," Working Paper 1471, Economics Department, Queen's University.
    5. David Klinowski, 2021. "Reluctant donors and their reactions to social information," Experimental Economics, Springer;Economic Science Association, vol. 24(2), pages 515-535, June.
    6. Christoph Bauer & Katie Spangenberg & Eric R. Spangenberg & Andreas Herrmann, 2022. "Collect them all! Increasing product category cross-selling using the incompleteness effect," Journal of the Academy of Marketing Science, Springer, vol. 50(4), pages 713-741, July.

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    More about this item

    Keywords

    Charitable giving; Crowdfunding; Threshold public goods;
    All these keywords.

    JEL classification:

    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • D90 - Microeconomics - - Micro-Based Behavioral Economics - - - General
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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