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Why announce leadership contributions? : An experimental study of the signaling and reciprocity hypotheses Author info | Abstract | Publisher info | Download info | Related research | Statistics Potters, J.
Sefton, M.
Vesterlund, L. (Tilburg University, Center for Economic Research)
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Why do fundraisers announce initial contributions to their charity? Potential explanations are that these announcements cause future donors to increase their contributions, either because they want to reciprocate the generosity of earlier donors, or because the initial contributions are seen as a signal of the charity's quality. Using experimental methods we investigate these two hypotheses. When only the first donor is informed of the public good's quality, subjects not only copy the initial contribution, but the first donor also correctly anticipates this response. While this result is consistent with both the signaling and the reciprocity explanations, the latter is unlikely to be the driving force. The reason is that announcements have no effect on contribution levels when the quality of the public good is common knowledge. Thus our results provide strong support for the signaling hypothesis.
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Paper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number
100.
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Date of creation: 2001Date of revision:
Handle: RePEc:dgr:kubcen:2001100Contact details of provider: Web page: http://center.uvt.nl
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Find related papers by JEL classification: C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
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references Cited by : (explanations , Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.)
Potters, J.J.M. & Shefton, M. & Vesterlund, L., 2003.
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