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Defaults and Donations: Evidence from a Field Experiment

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  • Altmann, Steffen
  • Falk, Armin
  • Heidhues, Paul
  • Jayaraman, Rajshri

Abstract

We study how website defaults affect consumer behavior in the domain of charitable giving. In a field experiment that was conducted on a large platform for making charitable donations over the web, we exogenously vary the default options in two distinct choice dimensions. The first pertains to the primary donation decision, namely, how much to contribute to the charitable cause. The second relates to an "add-on" decision of how much to contribute to supporting the online platform itself. We find a strong impact of defaults on individual behavior: in each of our treatments, the modal positive contributions in both choice dimensions invariably correspond to the specified default amounts. Defaults, nevertheless, have no impact on aggregate donations. This is because defaults in the donation domain induce some people to donate more and others to donate less than they otherwise would have. In contrast, higher defaults in the secondary choice dimension unambiguously induce higher contributions to the online platform.

Suggested Citation

  • Altmann, Steffen & Falk, Armin & Heidhues, Paul & Jayaraman, Rajshri, 2015. "Defaults and Donations: Evidence from a Field Experiment," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 515, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
  • Handle: RePEc:trf:wpaper:515
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    Cited by:

    1. repec:bla:econom:v:84:y:2017:i:333:p:16-33 is not listed on IDEAS
    2. Jonathan Schulz & Petra Thiemann & Christian Thoeni, 2015. "Defaults in charitable giving," Discussion Papers 2015-06, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
    3. Altmann, Steffen & Falk, Armin & Grunewald, Andreas, 2013. "Incentives and Information as Driving Forces of Default Effects," IZA Discussion Papers 7610, Institute for the Study of Labor (IZA).
    4. Schulz, Jonathan F. & Thiemann, Petra & Thöni, Christian, 2017. "Nudging Generosity: Choice Architecture and Cognitive Factors in Charitable Giving," IZA Discussion Papers 11097, Institute for the Study of Labor (IZA).

    More about this item

    Keywords

    Default Options; Online Platforms; Charitable Giving; Field Experiment;

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers

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