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Giving versus Taking: A “Real Donation” Comparison of Warm Glow and Cold Prickle

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Listed:
  • Philip J. Grossman
  • Catherine C. Eckel

Abstract

This paper revisits the question of “warm glow” vs. „cold prickle” and the provision of public goods. It also addresses the question, is giving in Dictator Games an expression of altruism or an artifact of experimentation? What is unique about this paper is that we employ a “real donation” lab experiment in a context-rich environment: contributions go to actual public goods (i.e., charitable organizations). Our study focuses directly on subjects‟ willingness to contribute to and take from a charity. We do this by allocating the initial endowment in one of three ways: either all to the subjects, all to the charity, or evenly between the two. Subjects are allowed to either contribute or take back as little or as much as they wish. We find that how the endowment is initially allocated is irrelevant when comparing the two extreme cases. On the other hand, we find evidence suggesting that, when the endowment is evenly split between the two parties, the initial even split seems to act as a powerful focal point: the final outcome is insignificantly different from the initial allocation.

Suggested Citation

  • Philip J. Grossman & Catherine C. Eckel, 2012. "Giving versus Taking: A “Real Donation” Comparison of Warm Glow and Cold Prickle," Monash Economics Working Papers 40-12, Monash University, Department of Economics.
  • Handle: RePEc:mos:moswps:2012-40
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    File URL: http://www.buseco.monash.edu.au/eco/research/papers/2012/4012givingversusgrossmaneckel.pdf
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    References listed on IDEAS

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    Cited by:

    1. Lenka Fiala & Charles N. Noussair, 2017. "Charitable Giving, Emotions, And The Default Effect," Economic Inquiry, Western Economic Association International, vol. 55(4), pages 1792-1812, October.
    2. Kim Lehrer & Catherine Porter, 2018. "Charitable Dictators? Determinants of Giving to NGOs in Uganda," Journal of International Development, John Wiley & Sons, Ltd., vol. 30(1), pages 80-101, January.
    3. Benjamin Ho & John Taber & Gregory Poe & Antonio Bento, 2016. "The Effects of Moral Licensing and Moral Cleansing in Contingent Valuation and Laboratory Experiments on the Demand to Reduce Externalities," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 64(2), pages 317-340, June.
    4. Oleg Korenok & Edward Millner & Laura Razzolini, 2014. "Taking, giving, and impure altruism in dictator games," Experimental Economics, Springer;Economic Science Association, vol. 17(3), pages 488-500, September.
    5. Subhasish M. Chowdhury & Joo Young Jeon & Bibhas Saha, 2017. "Gender Differences in the Giving and Taking Variants of the Dictator Game," Southern Economic Journal, John Wiley & Sons, vol. 84(2), pages 474-483, October.
    6. Chang, Daphne & Chen, Roy & Krupka, Erin, 2019. "Rhetoric matters: A social norms explanation for the anomaly of framing," Games and Economic Behavior, Elsevier, vol. 116(C), pages 158-178.
    7. Shachar Kariv & Daniel Lee & John List & Michael Price, 2016. "The Richness of Giving: Charity Selection and Charitable Gifts in a Large Field Experiment," Artefactual Field Experiments 00559, The Field Experiments Website.
    8. Kettner , Sara Elisa & Ceccato , Smarandita, 2014. "Framing Matters in Gender-Paired Dictator Games," Working Papers 0557, University of Heidelberg, Department of Economics.
    9. Cox, Caleb & Korenok, Oleg & Millner, Edward & Razzolini, Laura, 2018. "Giving, taking, earned money, and cooperation in public good games," Economics Letters, Elsevier, vol. 171(C), pages 211-213.
    10. Zhang, Le & Ortmann, Andreas, 2016. "Pro-social or anti-social, or both? A within- and between-subjects study of social preferences," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 62(C), pages 23-32.

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    More about this item

    Keywords

    Warm Glow; Cold Prickle; Charity; Altruism;
    All these keywords.

    JEL classification:

    • H4 - Public Economics - - Publicly Provided Goods
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior

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