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Subsidizing Charitable Contributions in the Field: Evidence from a Non-Secular Charity

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  • Catherine C. Eckel
  • Philip J. Grossman

Abstract

This paper reports results from a field study comparing the effects of rebates and matching subsidies for charitable contributions. The study was conducted in conjunction with Lutheran Social Services of Minnesota, a religiously affiliated social services charity. The field experiment has three main treatments: a baseline with no subsidy, a rebate to donors of a portion of their contribution to the charity, and an equivalent matching contribution. Within each subsidy treatment there are two rates of subsidy: 20 and 25 percent rebates and 25 and 33 percent matches. We report results that for the most part validate prior laboratory experiments. These results suggest that replacing the current tax rebate system with a matching program of equal cost could increase total giving to charitable organizations.

Suggested Citation

  • Catherine C. Eckel & Philip J. Grossman, 2006. "Subsidizing Charitable Contributions in the Field: Evidence from a Non-Secular Charity," Monash Economics Working Papers archive-44, Monash University, Department of Economics.
  • Handle: RePEc:mos:moswps:archive-44
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    File URL: http://www.utdallas.edu/~eckelc/Catherine%20Eckel_files/lss%20paper%20final.pdf
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    References listed on IDEAS

    as
    1. Clotfelter, Charles T., 1980. "Tax incentives and charitable giving: evidence from a panel of taxpayers," Journal of Public Economics, Elsevier, vol. 13(3), pages 319-340, June.
    2. Catherine C. Eckel & Philip J. Grossman, 2006. "Subsidizing Charitable Giving with Rebates or Matching: Further Laboratory Evidence," Southern Economic Journal, Southern Economic Association, vol. 72(4), pages 794-807, April.
    3. Douglas D. Davis & Edward L. Millner, 2005. "Rebates, Matches, and Consumer Behavior," Southern Economic Journal, Southern Economic Association, vol. 72(2), pages 410-421, October.
    4. Catherine C. Eckel & Philip J. Grossman, 2006. "Do Donors Care about Subsidy Type? An Experimental Study," Monash Economics Working Papers archive-10, Monash University, Department of Economics.
    5. Tiehen, Laura, 2001. "Tax Policy and Charitable Contributions of Money," National Tax Journal, National Tax Association, vol. 54(n. 4), pages 707-23, December.
    6. Douglas Davis & Edward Millner & Robert Reilly, 2005. "Subsidy Schemes and Charitable Contributions: A Closer Look," Experimental Economics, Springer;Economic Science Association, vol. 8(2), pages 85-106, June.
    7. Barrett, Kevin S. & McGuirk, Anya M. & Steinberg, Richard S., 1997. "Further Evidence on the Dynamic Impact of Taxes on Charitable Giving," National Tax Journal, National Tax Association, vol. 50(2), pages 321-334, June.
    8. Tiehen, Laura, 2001. "Tax Policy and Charitable Contributions of Money," National Tax Journal, National Tax Association, vol. 54(4), pages 707-723, December.
    9. Barrett, Kevin S. & McGuirk, Anya M. & Steinberg, Richard S., 1997. "Further Evidence on the Dynamic Impact of Taxes on Charitable Giving," National Tax Journal, National Tax Association, vol. 50(2), pages 321-34, June.
    10. Clotfelter, Charles T, 1980. "Tax Incentives and Charitable Giving: Evidence from a Panel of Taxpayers," Empirical Economics, Springer, vol. 13(3), pages 319-340, June.
    11. 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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    Cited by:

    1. Olga Bogach & Andreas Leibbrandt, 2011. "An Experimental Study on the Relevance and Scope of Culture as a Focal Point," Working Papers 201104, University of Hawaii at Manoa, Department of Economics.
    2. Emmanuel Saez, 2009. "Details Matter: The Impact of Presentation and Information on the Take-Up of Financial Incentives for Retirement Saving," American Economic Journal: Economic Policy, American Economic Association, vol. 1(1), pages 204-228, February.
    3. Kling, Jeffrey R., 2007. "Methodological Frontiers of Public Finance Field Experiments," National Tax Journal, National Tax Association, vol. 60(1), pages 109-127, March.
    4. Douglas D. Davis, 2006. "Rebate subsidies, matching subsidies and isolation effects," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 1, pages 13-22, July.
    5. Christina Fong & Erzo Luttmer, 2007. "What determines giving to hurricane katrina victims? Experimental evidence on income, race, and fairness," Artefactual Field Experiments 00046, The Field Experiments Website.

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