Date of Graduation

7-2021

Document Type

Dissertation

Degree Name

Doctor of Philosophy in Economics (PhD)

Degree Level

Graduate

Department

Economics

Advisor/Mentor

Peter McGee

Committee Member

Sherry Li

Second Committee Member

Amy Farmer

Keywords

Altruism, Behavioral, Charitable Fundraising, Charity, Economics, Giving

Abstract

This dissertation contains three essays on economic experiments concerning altruistic motives. The first chapter, “Choice Overload and Charitable Giving: Can There Be Too Much of a Good Thing?” concentrates on the effects of list sizes of charitable options on an individual’s decision making. The second chapter, “Is No News Good News? Motivated Reasoning in Charitable Giving,” focuses on the impact of information acquisition on an individual’s altruistic contributions. Finally, the third chapter, “Thank You, but No Thank You: Gift Incentives in Charitable Giving,” investigates gift incentives and their influence on donating behavior.

In the first chapter, “Choice Overload and Charitable Giving: Can There Be Too Much of a Good Thing?” subjects are confronted with a choice set of charitable options in an altruistic framework. Choice overload is a phenomenon whereby decision makers are overwhelmed by the choices they face. This can lead to poor decisions and reductions in welfare. I conduct a field experiment where subjects face three donation lists of varying lengths and are asked whether they would like to donate to the charities offered. On the extensive margin, I find a U-shape exists for giving i.e., donations are least frequent with an intermediate number of options. On the intensive margin, there is no significant difference between the donated amounts individuals give with the different list size treatments.

In the second chapter, “Is No News Good News? Motivated Reasoning in Charitable Giving,” we run an experiment where varying amounts of information on charitable organizations are given to different treatments. We assume that more information is better to less whereby consumers are better informed and thus can make better decisions. Yet, we find when individuals are faced with sufficient flexibility, individuals sometimes recruit information to prioritize self-interest at the cost of morality. This is known as motivated reasoning. We find that when more information is present about charities (such as leadership compensation and financial summaries) at the beginning of the donation decision, individuals are becoming less likely to donate.

In the third chapter, “Thank You, but No Thank You: Gift Incentives in Charitable Giving,” I employ a field experiment where I offer different gift incentives in return for donating to a charity. There is not much consensus on how extrinsic incentives (such as conditional thank-you gifts or raffles to win a gift) impact giving. Some prior research has found that offering extrinsic incentives can crowd out intrinsic incentives for giving and thus individuals donate less and less often. For this study, there are three treatments which include a Voluntary Contribution Mechanism (VCM) where subjects are asked if they want to donate to a charity with no extra incentives, a conditional gift mechanism where subjects are given a conditional gift if they donate, and a raffle mechanism where a chance to win a larger prize if one donates. This is an ongoing study which hopes to provide avenues for future work on charitable giving and policy recommendations for charitable organizations on how to best collect donations.

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