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Charitable giving when altruism and similarity are linked


  • Rotemberg, Julio J.


This paper presents a model in which anonymous charitable donations are rationalized by two human tendencies drawn from the psychology literature. The first is people's disproportionate disposition to help those they agree with while the second is the dependence of peoples' self-esteem on the extent to which they perceive that others agree with them. Government spending crowds out the charity that ensues from these forces only modestly. Moreover, people's donations tend to rise when others donate. In some equilibria of the model, poor people give little because they expect donations to come mainly from richer individuals. In others, donations by poor individuals constitute a large fraction of donations and this raises the incentive for poor people to donate. The model provides interpretations for episodes in which the number of charities rises while total donations are stagnant.

Suggested Citation

  • Rotemberg, Julio J., 2014. "Charitable giving when altruism and similarity are linked," Journal of Public Economics, Elsevier, vol. 114(C), pages 36-49.
  • Handle: RePEc:eee:pubeco:v:114:y:2014:i:c:p:36-49 DOI: 10.1016/j.jpubeco.2012.09.003

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    References listed on IDEAS

    1. Ellingsen, Tore & Johannesson, Magnus, 2011. "Conspicuous generosity," Journal of Public Economics, Elsevier, vol. 95(9-10), pages 1131-1143, October.
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    Cited by:

    1. repec:eee:jeborg:v:136:y:2017:i:c:p:45-62 is not listed on IDEAS
    2. Ek, Claes, 2015. "Prosocial Behavior and Policy Spillovers: A Multi-Activity Approach," Working Papers 2015:26, Lund University, Department of Economics, revised 11 Sep 2017.
    3. Ek, Claes, 2015. "Some Causes are More Equal than Others? Behavioral Spillovers in Charitable Giving," Working Papers 2015:29, Lund University, Department of Economics.
    4. Cueva, Carlos & Dessi, Roberta, 2012. "Charitable Giving, Self-Image and Personality," TSE Working Papers 12-342, Toulouse School of Economics (TSE).
    5. van Rijn, Jordan & Barham, Bradford & Sundaram-Stukel, Reka, 2016. "An Experimental Approach to Comparing Similarity- and Guilt-Based Charitable Appeals," Staff Paper Series 584, University of Wisconsin, Agricultural and Applied Economics.
    6. repec:eee:soceco:v:68:y:2017:i:c:p:25-40 is not listed on IDEAS

    More about this item


    Charitable contributions; Altruism; Homophily;

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household


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