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Matched Fundraising: Evidence from a Natural Field Experiment

  • Huck, Steffen
  • Rasul, Imran

We present evidence from a natural field experiment designed to shed light on the efficacy of fundraising schemes in which donations are matched by a lead donor. In conjunction with the Bavarian State Opera House, we mailed 14,000 regular opera attendees a letter describing a charitable fundraising project organized by the opera house. Recipients were randomly assigned to treatments designed to explore behavioral responses to linear matching schemes, as well as the mere existence of a substantial lead donor. We use the exogenous variation in match rates across treatments to estimate the price elasticities of charitable giving. We find that straight linear matching schemes raise the total donations received including the match value, but partially crowd out the actual donations given excluding the match. If charitable organizations can use lead gifts as they wish, our results show they maximize donations given by simply announcing the presence of a lead gift. We contrast our price elasticity estimates with those based on changes in rules regarding tax deductions for charitable giving, as well as from the nascent literature using large-scale natural field experiments on giving.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 8075.

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Date of creation: Oct 2010
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Handle: RePEc:cpr:ceprdp:8075
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  1. Eckel, Catherine C. & Grossman, Philip J., 2003. "Rebate versus matching: does how we subsidize charitable contributions matter?," Journal of Public Economics, Elsevier, vol. 87(3-4), pages 681-701, March.
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  4. Catherine Eckel, 2005. "Subsidizing Charitable Contributions: A Field Test Comparing Matching and Rebate Subsidies," Working Papers 2098, The Field Experiments Website.
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  16. Auten, Gerald E. & Cilke, James M. & Randolph, William C., 1992. "The Effects of Tax Reform on Charitable Contributions," National Tax Journal, National Tax Association, vol. 45(3), pages 267-90, September.
  17. Cermak, Dianne S. P. & File, Karen Maru & Prince, Russ Alan, 1994. "A benefit segmentation of the major donor market," Journal of Business Research, Elsevier, vol. 29(2), pages 121-130, February.
  18. Huck, Steffen & Rasul, Imran & Shephard, Andrew, 2012. "Comparing charitable fundraising schemes: Evidence from a field experiment and a structural model," Discussion Papers, Research Unit: Economics of Change SP II 2012-303, Social Science Research Center Berlin (WZB).
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