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How to Design the Ask? Funding Units vs. Giving Money

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  • Johannes Diederich
  • Raphael Epperson
  • Timo Goeschl

Abstract

Unit donations are an alternative fundraising scheme in which potential donors choose how many units of a charitable good to fund, rather than just giving money. Based on evidence from an online experiment with 8,673 participants, we demonstrate that well-designed unit donation schemes can significantly boost giving above and beyond the standard money donation scheme. A decomposition of the underlying mechanisms shows patterns consistent with the conjecture that unit donations increase impact salience and leverage donors’ cognitive biases by changing the metric of the donation space. Managers need to weigh the potential fundraising benefits of a unit scheme against some important challenges, such as expert handling of the choice of unit sizes.

Suggested Citation

  • Johannes Diederich & Raphael Epperson & Timo Goeschl, 2022. "How to Design the Ask? Funding Units vs. Giving Money," Working Papers 2022-18, Faculty of Economics and Statistics, Universität Innsbruck.
    • Handle: RePEc:inn:wpaper:2022-18
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    More about this item

    Keywords

    Aid effectiveness; charitable giving; framing; restricted choice; unit donation;
    All these keywords.

    JEL classification:

    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • H4 - Public Economics - - Publicly Provided Goods
    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship

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