The size and distribution of donations: Effects of numbers of potential recipients
AbstractWhereas much literature exists on “choice overload,” little is known about effects of numbers of alternatives in donation decisions. How do these affect both the size and distribution of donations? We hypothesize that donations are affected by the reputation of recipients and increase with their number, albeit at a decreasing rate. Allocations to recipients reflect different concepts of fairness – “equity” and “equality.” Both may be employed but, since they differ in cognitive and emotional costs, numbers of recipients are important. Using a cognitive (emotional) argument, distributions become more uniform (skewed) as numbers increase. In a survey, respondents indicated how they would donate lottery winnings of 50 Euros. Results indicated that more was donated to NGO’s that respondents knew better. Second, total donations increased with the number of recipients albeit at a decreasing rate. Third, distributions of donations became more skewed as numbers increased. We comment on theoretical and practical implications.
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Bibliographic InfoPaper provided by Department of Economics and Business, Universitat Pompeu Fabra in its series Economics Working Papers with number 1246.
Date of creation: Nov 2010
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choice overload; donation decisions; fairness; equality; equity. leex;
Find related papers by JEL classification:
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
- L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs
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- Stephan Dickert & Janet Kleber & Ellen Peters & Paul Slovic, 2011. "Numeracy as a precursor to pro-social behavior: The impact of numeracy and presentation format on the cognitive mechanisms underlying donation decisions," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 6(7), pages 638-650, October.
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