Is Charitable Giving a Zero-Sum Game? The Effect of Competition Between Charities on Giving Behavior

2021 ◽  
Author(s):  
Jan Schmitz
Keyword(s):  
Nonprofit Organizations ◽  
Charitable Giving ◽  
Price Competition ◽  
Dictator Game ◽  
Relative Price ◽  
Fundraising Strategies ◽  
Matching Grant ◽  
Good Provision ◽  
Zero Sum ◽  
Choice Set

The competition for donations between charities is tough. Yet, little is known about how giving behavior is affected by competition between charities. Do people have a need to satisfy their demand for giving by contributing to a particular charity? Or can the demand for doing good be satisfied by giving to any organization? In a donation dictator game, I vary competition between charities by (i) altering the set of similar real charities to which subjects can donate and (ii) changing the relative price of giving to a randomly selected charity in the choice set by introducing a matching grant. I find weak substitution between charities when giving to more than one charity is possible, as the donated amounts to individual charities decrease with the size of the choice set. At the same time, aggregate giving to all charities increases when charities are in competition. Intensified competition through an increase in the charitable giving market seems to attract new giving and increases overall public good provision. Price competition, however, does not attract new donations when market size is constant and charities compete for donations. These findings carry important insights for managers of nonprofit organizations and provide information on how to improve existing fundraising strategies. This paper was accepted by Yan Chen, decision analysis.

Motives for corporate philanthropy and charitable causes supported

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Dane K. Peterson ◽  
Cathryn Van Landuyt ◽  
Courtney Pham
Keyword(s):  
Nonprofit Organizations ◽  
Charitable Giving ◽  
Corporate Philanthropy ◽  
Motivational Factors ◽  
Published Data ◽  
Theoretical Understanding ◽  
Content Type ◽  
For Profit ◽  
Corporate Strategies ◽  
Private Corporations

PurposeThis paper examines how the inferred motives for corporate philanthropy relate to the types of charitable causes supported.Design/methodology/approachPublished data were obtained for 256 publicly traded and private corporations from a variety of sources.FindingsThe results demonstrated that a number of motives were not significantly related to total charitable giving, but were related to how charitable funds were distributed to various charitable causes. Thus, the study provides insights on the strategic use of corporate charity as means of achieving various business objectives and advancing a theoretical understanding of corporate philanthropy strategies.Research limitations/implicationsThis study only investigated some of the presumed motives for corporate philanthropy. Even for the motives investigated in this study, no attempt was made to examine all the motivational factors that determine the level of need for a specific motive. Thus, while the present study provides some of the first evidence of a relationship between motivational factors and data on the types of charitable causes supported, there are other motivational factors that could be investigated in future studies.Practical implicationsThe results have a number of implications for managers of nonprofit organizations such as marketing/targeting potential donors. Additionally, the results could be useful for managers of for profit firms in terms of comparing corporate strategies with competing firms.Originality/valueThe study provides a framework for investigating the relationship between motivational factors and types of charitable causes supported.

scholarly journals Organizational Factors Affecting Charitable Giving in the Environmental Nonprofit Context

2020 ◽  
Vol 12 (21) ◽  
pp. 8947 ◽  
Author(s):  
Chiara Leardini ◽  
Gina Rossi ◽  
Stefano Landi
Keyword(s):  
Nonprofit Organizations ◽  
Charitable Giving ◽  
Organizational Factors ◽  
The United States ◽  
Online Information ◽  
Charitable Contributions ◽  
Factors Affecting ◽  
Conditional Effect ◽  
Environmental Nonprofits ◽  
Positive Effect

Nonprofit organizations operating in the environmental protection and conservation sector face challenging fundraising issues in collecting from individual donors the money needed to accomplish their goals. The purpose of this study was to investigate which organizational factors can play a role in influencing the ability of these organizations to collect charitable contributions. By applying an extended version of the economic model of giving to a sample of 142 environmental nonprofits from the United States, the results of the regression analyses show that the following factors allow these organizations to attract more donations: devoting a high percentage of donations to programs, promoting the organization’s image through fundraising activities, having a large amount of assets that ensures a sustainable financial structure, and providing online information that demonstrates how the organization has dealt with its mission. Moreover, the study reveals that providing high amounts of disclosure on the organization’s website can have a conditional effect on fundraising expenses by boosting the positive effect of these expenses on donations. The results of this study contribute to the debate on the effectiveness of organizational factors in attracting funds from donors willing to support environmental nonprofits.

scholarly journals Charity Begins at Home: A Lab-in-the-Field Experiment on Charitable Giving

Games ◽  
2018 ◽  
Vol 9 (4) ◽  
pp. 95 ◽  
Author(s):  
Catherine Eckel ◽  
Benjamin Priday ◽  
Rick Wilson
Keyword(s):  
Field Experiment ◽  
Charitable Giving ◽  
Fire Department ◽  
Dictator Game ◽  
Charitable Organizations ◽  
Fixed Amount ◽  
Local Organizations ◽  
The Gift ◽  
The Individual ◽  
Different Levels

Charities operate at different levels: national, state, or local. We test the effect of the level of the organization on charitable giving in a sample of adults in two Texas communities. Subjects make four charitable giving “dictator game” decisions from a fixed amount of money provided by the experimenter. Three decisions target different charitable organizations, all of which have a disaster-relief mission, but differ in the level of operation. The fourth targets an individual recipient, identified by the local fire department as a victim of a fire. One of the four is selected randomly for payment. Giving is significantly higher to national and local organizations compared to state. We find a higher propensity to donate and larger amount donated to the individual relative to all organizations. Subsequent analysis compares a number of demographic and attitudinal covariates with donations to specific charities. In a second decision, subjects instead indicate which of their four prior decisions they would most prefer to implement. Here we see that a majority of subjects prefer the gift to the individual.

scholarly journals The Market for Charitable Giving

2011 ◽  
Vol 25 (2) ◽  
pp. 157-180 ◽  
Author(s):  
John A List
Keyword(s):  
Gross Domestic Product ◽  
Nonprofit Organizations ◽  
Charitable Giving ◽  
Charitable Organizations ◽  
Charitable Contributions ◽  
Half Century ◽  
The Past ◽  
Past Half Century ◽  
Past Half ◽  
Matching Grants

Through good and bad economic times, charitable gifts have continued to roll in largely unabated over the past half century. In a typical year, total charitable gifts of money now exceed 2 percent of gross domestic product. Moreover, charitable giving has nearly doubled in real terms since 1990, and the number of nonprofit organizations registered with the IRS grew by nearly 60 percent from 1995 to 2005. This study provides a perspective on the economic interplay of three types of actors: donors, charitable organizations, and government. How much is given annually? Who gives? Who are the recipients of these gifts? Would changes in the tax treatment of charitable contributions lead to more or less giving? How can charitable institutions design mechanisms to generate the greatest level of gifts? What about the effectiveness of seed money and matching grants?

Limited Choice Sets, Local Price Response, and Implied Measures of Price Competition

1996 ◽  
Vol 33 (2) ◽  
pp. 163-173 ◽  
Author(s):  
Bart J. Bronnenberg ◽  
Wilfried R. Vanhonacker
Keyword(s):  
Price Competition ◽  
Brand Choice ◽  
Price Response ◽  
Price Search ◽  
Choice Sets ◽  
Point Of Purchase ◽  
Choice Decision ◽  
Biased Estimates ◽  
Limited Choice ◽  
Choice Set

It is becoming increasingly evident that a consumer's brand choice decision in low-involvement categories does not involve full search, evaluation, and comparison of price information of all brands available at point of purchase (global price response). The authors propose a two-stage choice process in which the consumer first identifies a subset of brands within the universal set of brands called the choice set and then evaluates only those brands that are in the choice set relative to one another to select a single brand. The authors find that, consistent with reports of the extent of external price search of consumers, response to shelf price variations is limited to the brands in the choice set (local price response). Their results indicate that employing the assumption of global price response may lead to biased estimates of price elasticity and derived measures of clout and vulnerability. To enable a managerially meaningful and useful assessment of a brand's competitive clout and vulnerability, the authors provide a brand-level approach to integrate local price response into the derivation of these measures.

Morals and Emotions of Money

Money Talks ◽  
2017 ◽  
Author(s):  
Nina Bandelj ◽  
Tyler Boston ◽  
Julia Elyachar ◽  
Julie Kim ◽  
Michael McBride ◽  
...  
Keyword(s):  
Experimental Design ◽  
Charitable Giving ◽  
Dictator Game ◽  
Moral Judgments ◽  
Experimental Conditions ◽  
Real Money ◽  
Over Time

This chapter reports findings from an interdisciplinary investigation of charitable giving. The authors studied charity contributions using a Dictator Game experimental design whereby participants are given tokens with real money value and can decide to contribute to charity or to keep the money for themselves. But to get a better sense of the role of morals and emotions, they also asked participants to explain their motivations for giving. In addition, they conducted the experiment with the same student participants at two different points in time. They found that those who contribute more to charity tend to be women, tend to evaluate themselves as less self-interested, and are more likely to have been those who gave to charity at the first point in time. The choices of particular charities are not very consistent over time but depend on participants' moral and emotional evaluations. The chapter concludes that even in abstract experimental conditions, moral judgments and emotional underpinnings are not discrete influences on how people think about and use money but are thoroughly intertwined, relationally grounded, and reinforced by practice.

scholarly journals Does Price Matter in Charitable Giving? Evidence from a Large-Scale Natural Field Experiment

2007 ◽  
Vol 97 (5) ◽  
pp. 1774-1793 ◽  
Author(s):  
Dean Karlan ◽  
John A List
Keyword(s):  
Field Experiment ◽  
Charitable Giving ◽  
Large Scale ◽  
Cost Benefit Analysis ◽  
Cost Benefit ◽  
Theoretical Work ◽  
Benefit Analysis ◽  
Natural Field ◽  
Natural Field Experiment ◽  
Matching Grant

We conducted a natural field experiment to further our understanding of the economics of charity. Using direct mail solicitations to over 50,000 prior donors of a nonprofit organization, we tested the effectiveness of a matching grant on charitable giving. We find that the match offer increases both the revenue per solicitation and the response rate. Larger match ratios (i.e., $3:$1 and $2:$1) relative to a smaller match ratio ($1:$1) had no additional impact, however. The results provide avenues for future empirical and theoretical work on charitable giving, cost-benefit analysis, and the private provision of public goods. (JEL D64, L31)

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