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Peer effects in charitable giving: Evidence from the (running) field

Author

Listed:
  • Sarah Smith
  • Frank Windmeijer
  • Edmund Wright

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Abstract

There is a widespread belief that peer effects are important in charitable giving, but surprisingly little evidence on how donors respond to their peers. We analyse a unique dataset of donations to online fundraising pages to provide evidence on the direction and magnitude of peer effects – we find that a £10 increase in the mean of past donations increases giving by £3.50, on average. We also explore potential explanations for why peers matter. We find no evidence that donations provide a signal of charity quality, nor any role for fundraising targets. Our preferred explanation is that donors benchmark themselves against the distribution of donations from their peers.

Suggested Citation

  • Sarah Smith & Frank Windmeijer & Edmund Wright, 2012. "Peer effects in charitable giving: Evidence from the (running) field," The Centre for Market and Public Organisation 12/290, Department of Economics, University of Bristol, UK.
  • Handle: RePEc:bri:cmpowp:12/290
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    File URL: http://www.bristol.ac.uk/cmpo/publications/papers/2012/wp290.pdf
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    References listed on IDEAS

    as
    1. Bruce Sacerdote, 2001. "Peer Effects with Random Assignment: Results for Dartmouth Roommates," The Quarterly Journal of Economics, Oxford University Press, vol. 116(2), pages 681-704.
    2. Alpizar, Francisco & Carlsson, Fredrik & Johansson-Stenman, Olof, 2008. "Anonymity, reciprocity, and conformity: Evidence from voluntary contributions to a national park in Costa Rica," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1047-1060, June.
    3. Lawrence F. Katz & Jeffrey R. Kling & Jeffrey B. Liebman, 2001. "Moving to Opportunity in Boston: Early Results of a Randomized Mobility Experiment," The Quarterly Journal of Economics, Oxford University Press, vol. 116(2), pages 607-654.
    4. Nickell, Stephen J, 1981. "Biases in Dynamic Models with Fixed Effects," Econometrica, Econometric Society, vol. 49(6), pages 1417-1426, November.
    5. Warr, Peter G., 1982. "Pareto optimal redistribution and private charity," Journal of Public Economics, Elsevier, vol. 19(1), pages 131-138, October.
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    Citations

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    Cited by:

    1. Adena, Maja & Huck, Steffen, 2016. "Online fundraising, self-image, and the long-term impact of ask avoidance," Annual Conference 2016 (Augsburg): Demographic Change 145535, Verein für Socialpolitik / German Economic Association.
    2. Park, Sangkon & Nam, Sohyun & Lee, Jungmin, 2017. "Charitable giving, suggestion, and learning from others: Pay-What-You-Want experiments at a coffee shop," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 66(C), pages 16-22.
    3. repec:eee:joepsy:v:61:y:2017:i:c:p:124-133 is not listed on IDEAS
    4. Scharf, Kimberley & Smith, Sarah, 2014. "Relational Warm Glow and Giving in Social Groups," CEPR Discussion Papers 10051, C.E.P.R. Discussion Papers.
    5. repec:bri:cmpowp:13/324 is not listed on IDEAS
    6. repec:eee:gamebe:v:107:y:2018:i:c:p:282-297 is not listed on IDEAS
    7. Scharf, Kimberley & Smith, Sarah, 2016. "Relational altruism and giving in social groups," Journal of Public Economics, Elsevier, vol. 141(C), pages 1-10.
    8. Amadou Boly & Robert Gillanders & Topi Miettinen, 2016. "Deterrence, peer effect, and legitimacy in anti-corruption policy-making: An experimental analysis," WIDER Working Paper Series 137, World Institute for Development Economic Research (UNU-WIDER).
    9. Sanjit Dhami & Ali al-Nowaihi, 2016. "Social responsibility, human morality and public policy," Discussion Papers in Economics 16/20, Department of Economics, University of Leicester.
    10. Naroditskiy, Victor & Stein, Sebastian & Tonin, Mirco & Tran-Thanh, Long & Vlassopoulos, Michael & Jennings, Nicholas R., 2014. "Referral Incentives in Crowdfunding," IZA Discussion Papers 7995, Institute for the Study of Labor (IZA).
    11. repec:kap:jfsres:v:52:y:2017:i:1:d:10.1007_s10693-017-0270-9 is not listed on IDEAS
    12. Daniel Jones & Sera Linardi, 2014. "Wallflowers: Experimental Evidence of an Aversion to Standing Out," Management Science, INFORMS, vol. 60(7), pages 1757-1771, July.
    13. repec:eee:joinma:v:41:y:2018:i:c:p:81-93 is not listed on IDEAS
    14. Michael Sanders & David Reinstein, 2014. "Worth 1000 Words: The effect of social cues on a fundraising campaign in a government agency. A field experiment," The Centre for Market and Public Organisation 14/324, Department of Economics, University of Bristol, UK.
    15. repec:spr:soinre:v:134:y:2017:i:1:d:10.1007_s11205-016-1431-1 is not listed on IDEAS
    16. Lacetera, Nicola & Macis, Mario & Mele, Angelo, 2014. "Viral Altruism? Generosity and Social Contagion in Online Networks," IZA Discussion Papers 8171, Institute for the Study of Labor (IZA).
    17. Arbel, Yuval & Bar-El, Ronen & Tobol, Yossef, 2016. "Fundraising to a real-life public good – evidence from the laboratory," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 65(C), pages 27-37.
    18. Michael Sanders & Sarah Smith, 2014. "A warm glow in the after life? The determinants of charitable bequests," The Centre for Market and Public Organisation 14/326, Department of Economics, University of Bristol, UK.
    19. Charles M. Kahn & José M. Liñares-Zegarra & Joanna Stavins, 2017. "Are there Social Spillovers in Consumers’ Security Assessments of Payment Instruments?," Journal of Financial Services Research, Springer;Western Finance Association, vol. 52(1), pages 5-34, October.
    20. Gee, Laura Katherine, 2016. "The More You Know: Information Effects on Job Application Rates in a Large Field Experiment," IZA Discussion Papers 10372, Institute for the Study of Labor (IZA).
    21. Sanders, Michael & Smith, Sarah, 2016. "Can simple prompts increase bequest giving? Field evidence from a legal call centre," Journal of Economic Behavior & Organization, Elsevier, vol. 125(C), pages 179-191.

    More about this item

    Keywords

    charitable giving; peer effects; donations;

    JEL classification:

    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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