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Toward an Understanding of the Economics of Charity: Evidence from a Field Experiment

  • Craig Landry
  • Andreas Lange
  • John A. List
  • Michael K. Price
  • Nicholas G. Rupp

This study develops theory and uses a door-to-door fundraising field experiment to explore the economics of charity. We approached nearly 5000 households, randomly divided into four experimental treatments, to shed light on key issues on the demand side of charitable fundraising. Empirical results are in line with our theory: in gross terms, our lottery treatments raised considerably more money than our voluntary contributions treatments. Interestingly, we find that a one standard deviation increase in female solicitor physical attractiveness is similar to that of the lottery incentive¡ªthe magnitude of the estimated difference in gifts is roughly equivalent to the treatment effect of moving from our theoretically most attractive approach (lotteries) to our least attractive approach (voluntary contributions).

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File URL: http://www.nber.org/papers/w11611.pdf
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 11611.

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Date of creation: Sep 2005
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Publication status: published as Landry, Craig E., Andreas Lange, John A. List, Michael K. Price and Nicholas G. Rupp. "Toward An Understanding Of The Economics Of Charity: Evidence From A Field Experiment," Quarterly Journal of Economics, 2006, v121(2,May), 747-782.
Handle: RePEc:nbr:nberwo:11611
Note: PE
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