Instrument-induced bias in donation mechanisms: Evidence from the field
AbstractEliciting actual donations toward a public good has been proposed as a means of estimating a lower bound to individuals' compensating surplus, and can be accomplished using mail/phone surveys or field experiments. This study shows that when warm-glow is present, the elicitation instrument decreases the transaction costs of donating. This presents an obstacle to using the donation mechanism. As a remedy, we propose the use of a multi-donation mechanism where subjects can direct their donation to alternative public goods. Results from a field experiment confirm this instrument-induced bias can be large, suggesting field experiment practitioners should seriously consider how their experimental procedures may alter economic behavior.
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Bibliographic InfoPaper provided by The Field Experiments Website in its series Framed Field Experiments with number 00194.
Date of creation: 2006
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Other versions of this item:
- Norwood Bailey & Lusk Jayson L, 2005. "Instrument-Induced Bias in Donation Mechanisms: Evidence from the Field," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 5(2), pages 1-26, December.
- C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
- Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
- D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy
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