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The impact of downward social information on contribution decisions

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  • Rachel Croson
  • Jen Shang

Abstract

In this paper we study the effect of downward social information in contribution decisions to fund public goods. We describe the results of a field experiment run in conjunction with the fundraising campaigns of a public radio station. Renewing members are presented with social information (information about another donor's contribution) which is either above or below their previous (last year's) contribution. We find that respondents change their contribution in the direction of the social information; increasing their contribution when the social information is above their previous contribution, and decreasing their contribution when the social information is below. We hypothesize about the psychological motivations that may cause the results and test these hypotheses by comparing the relative size of the upward and downward shifts. These results improve our understanding of cooperation in public good provision and suggest differential costs and benefits to fundraisers in providing social information.

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Paper provided by The Field Experiments Website in its series Natural Field Experiments with number 00322.

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Date of creation: 2008
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Handle: RePEc:feb:natura:00322

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  1. Catherine Eckel, 2005. "Subsidizing Charitable Contributions: A Field Test Comparing Matching and Rebate Subsidies," Working Papers 2098, The Field Experiments Website.
  2. John A. List & David Lucking-Reiley, 2000. "The Effects of Seed Money and Refunds on Charitable Giving: Experimental Evidence from a University Capital Campaign," Vanderbilt University Department of Economics Working Papers 0008, Vanderbilt University Department of Economics.
  3. Gary S. Becker, 1974. "A Theory of Social Interactions," NBER Working Papers 0042, National Bureau of Economic Research, Inc.
  4. Steven D. Levitt & John A. List, 2007. "What Do Laboratory Experiments Measuring Social Preferences Reveal About the Real World?," Journal of Economic Perspectives, American Economic Association, vol. 21(2), pages 153-174, Spring.
  5. Andreoni, James, 1990. "Impure Altruism and Donations to Public Goods: A Theory of Warm-Glow Giving?," Economic Journal, Royal Economic Society, vol. 100(401), pages 464-77, June.
  6. Sugden, Robert, 1984. "Reciprocity: The Supply of Public Goods through Voluntary Contributions," Economic Journal, Royal Economic Society, vol. 94(376), pages 772-87, December.
  7. Andreoni, James, 1989. "Giving with Impure Altruism: Applications to Charity and Ricardian Equivalence," Journal of Political Economy, University of Chicago Press, vol. 97(6), pages 1447-58, December.
  8. John A. List, 2007. "On the Interpretation of Giving in Dictator Games," Journal of Political Economy, University of Chicago Press, vol. 115, pages 482-493.
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