Barriers to charitable giving

Donating to charity requires time, effort and attention. If the costs to give are perceived to be large, charities may lose out on donations. We develop a nonparametric test for the presence of these general nuisance costs and conduct a large-scale field experiment to show that costs to give are sizable and impactful. Potential donors were offered a 5:1 fixed match if their donation met or exceeded a minimum amount (e.g. $1, $5 or $10). Absent nuisance costs, the probability of donating should decrease as the minimum amount increases. We find the opposite. We estimate that about half of donors in our sample have nuisance costs of $7 or more. Eliminating these costs would double donations. Charities seeking to expand donations from small donors thus face challenges. Offering a fixed match for donations above a certain threshold may be more effective, by essentially covering nuisance costs, than the standard practice of subsidizing all donations with dollar-for-dollar matches.