Desert and Tangibility: Decomposing House Money Effects in a Charitable Giving Experiment
AbstractSeveral papers have documented that when subjects play with standard laboratory �endowments� they make less self-interested choices then when they use money they have either earned through a laboratory task or brought from outside the lab. In the context of a charitable giving experiment we decompose common "house money" effects into two components: the tangibility of cash in hand relative to money (or ecu's) promised on a computer screen, and the desert of earned money relative to random windfall gains. While both components are found to be significant in non-parametric tests, the former effect, which has been neglected in previous studies, has a stronger effect on total donations. These results have clear implications for experimental design, and also suggest that the availability of less tangible payment methods may increase charitable donations.
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Bibliographic InfoPaper provided by University of Essex, Department of Economics in its series Economics Discussion Papers with number 680.
Date of creation: 04 Dec 2009
Date of revision:
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This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-12-11 (All new papers)
- NEP-CBE-2009-12-11 (Cognitive & Behavioural Economics)
- NEP-EXP-2009-12-11 (Experimental Economics)
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