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Giving and Probability

Author

Listed:
  • Christian Keller
  • David Reinstein
  • Gerhard Riener
  • Michael Sanders
Abstract
When and how should a fundraiser ask for a donation from an individual facing an uncertain bonus income? A standard model of expected utility over outcomes predicts that the individual’s before choice – her ex-ante commitment conditional on her income – will be the same as her choice after the income has been revealed. Deciding “if you win, how much will you donate?” involves a commitment (i) over a donation for a state of the world that may not be realized and (ii) over uncertain income. Models involving reference-dependent utility, tangibility, and self-signaling predict more giving before, while theories of affect predict more giving after. In our online field experiment at a UK university, as well as in our laboratory experiments in Germany, charitable giving was significantly larger in the Before treatment than in the After treatment for male subjects, with a significant gender differential.

Suggested Citation

  • Christian Keller & David Reinstein & Gerhard Riener & Michael Sanders, 2015. "Giving and Probability," The Centre for Market and Public Organisation 15/336, The Centre for Market and Public Organisation, University of Bristol, UK.
    • Handle: RePEc:bri:cmpowp:15/336
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    File URL: http://www.bristol.ac.uk/media-library/sites/cmpo/documents/WP14336Web_Version.pdf
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    Cited by:

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    More about this item

    JEL classification:

    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • L30 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - General
    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations

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