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Toward an Understanding of the Economics of Charity: Evidence from a Field Experiment

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  • Craig E. Landry
  • Andreas Lange
  • John A. List
  • Michael K. Price
  • Nicholas G. Rupp

Abstract

This study develops theory and uses a door-to-door fund-raising field experiment to explore the economics of charity. We approached nearly 5000 households, randomly divided into four experimental treatments, to shed light on key issues on the demand side of charitable fund-raising. Empirical results are in line with our theory: in gross terms, the lotteries raised more money than the voluntary contributions treatments. Interestingly, in terms of both maximizing current contributions and inducing participation, we find that a one-standard deviation increase in female solicitor physical attractiveness is similar to that ofthe lottery incentive.

Suggested Citation

  • Craig E. Landry & Andreas Lange & John A. List & Michael K. Price & Nicholas G. Rupp, 2006. "Toward an Understanding of the Economics of Charity: Evidence from a Field Experiment," The Quarterly Journal of Economics, Oxford University Press, vol. 121(2), pages 747-782.
    • Handle: RePEc:oup:qjecon:v:121:y:2006:i:2:p:747-782.
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    More about this item

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • L30 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - General

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