Sparing a dime

Kevin Lewis

May 01, 2016

"Wrong place to get help": A field experiment on luxury stores and helping behavior

Lubomir Lamy et al.

Social Influence, Spring 2016, Pages 130-139

Three experiments were conducted in field settings. It was hypothesized that luxury stores may act as environmental reminders of materialism and that helpfulness would vary according to the presence or absence of such cues. Study 1 (N = 80) indicated that consumers coming out of famous brand stores displayed less helpfulness, as compared to mere passersby. Study 2 (N = 112) showed passersby were less helpful near a luxury brand store than in an ordinary street with no shops. In Study 3 (N = 360), passersby were less helpful when walking down a street lined with highly exclusive stores, as compared to streets with ordinary stores or no stores. Results, limitations, and directions for future research are discussed.


Impact of episodic thinking on altruism

Richard Yi et al.

Journal of Experimental Social Psychology, forthcoming

Episodic future thinking, which refers to the use of prospective imagery to concretely imagine oneself in future scenarios, has been shown to reduce delay discounting (enhance self-control). A parallel approach, in which prospective imagery is used to concretely imagine other's scenarios, may similarly reduce social discounting (i.e., enhance altruism). In study 1, participants engaged in episodic thinking about the self or others, in a repeated-measures design, while completing a social discounting task. Reductions in social discounting were observed as a function of episodic thinking about others, though an interaction with order was also observed. Using an independent-measures design in study 2, the effect of episodic thinking about others was replicated. Study 3 addressed a limitation of studies 1 and 2, the possibility that simply thinking about others decreased social discounting. Capitalizing on Construal Level Theory, which specifies that social distance and time in the future are both dimensions of a common psychological distance, we hypothesized that episodic future thinking should also decrease social discounting. Participants engaged in episodic future thinking or episodic present thinking, in a repeated-measures design, while completing a social discounting task. The pattern of results was similar to study 1, providing support for the notion that episodic thinking about psychologically distant outcomes (for others or in the future) reduces social discounting. Application of similar episodic thinking approaches may enhance altruism.


Sharing One's Fortune? An Experimental Study on Earned Income and Giving

Mirco Tonin & Michael Vlassopoulos

Journal of Behavioral and Experimental Economics, forthcoming

In this paper, we investigate the relationship between earnings and charitable giving, in an environment in which earnings depend on luck but not in a manner that makes its contribution obvious. We set up a real effort experiment, in which subjects enter data in four one-hour occasions and are paid a piece rate. From the second occasion onwards, we randomly assign half of the subjects to a treatment with higher piece rates, without the subjects being explicitly made aware of the random assignment into the two groups. At the end we ask subjects whether they want to donate a share of their earnings to a charity of their choice. We find that, despite large differences in earnings due to the different piece rates, subjects receiving the higher piece rate are actually less likely to give, and that givers in the two groups give the same share of their total earnings. Charities receive the same average donation from members of the two groups, indicating that charitable giving by subjects in this experiment does not increase with income. We discuss how these results can be explained by self-serving attribution bias.


Generosity and Guilt: The Role of Beliefs and Moral Standards of Others

Karen Evelyn Hauge

Journal of Economic Psychology, June 2016, Pages 35-43

Why are people generous? One reason may be to avoid feeling guilt - in terms of failing to meet others' expectations or in terms of failing to meet others' moral standards. The present article reports an experiment using the 'dictator game' while manipulating the dictators' beliefs about the receivers' expectations and moral standards. The results indicate that generosity is indeed driven by guilt-aversion: Dictators are more generous when the receiver expects more, and also when the receiver considers that dictators should, morally speaking, give more. If dictators were motivated by pure altruism or equity concerns, the receiver's expectations or moral beliefs should not matter.


Do People Donate More When They Perceive A Single Beneficiary Whom They Know? A Field Experimental Test of the Identifiability Effect

Omar Al-Ubaydli & Mike Yeomans

Journal of Behavioral and Experimental Economics, forthcoming

According to the identifiability effect, people will donate more to a single beneficiary rather than to many beneficiaries, holding constant what the donations are actually used for. We test the identifiability effect for two novel subject pools (the suppliers and beneficiaries of volunteer labor). We also test a refinement of the identifiability effect where we vary whether or not the single beneficiary is personally known to the solicitees. While the behavior of volunteers is consistent with the identifiability effect, we find that the identifiability effect is reversed for beneficiaries of volunteer labor. Moreover, we find that making the single beneficiary personally known to the solicitees lowers donations by a statistically insignificant amount, suggesting that it does not enhance donations.


When Should the Ask Be a Nudge? The Effect of Default Amounts on Charitable Donations

Indranil Goswami & Oleg Urminsky

Journal of Marketing Research, forthcoming

How does setting a donation option as the default in a charitable appeal affect people's decisions? In eight studies, comprising 11,508 participants making 2,423 donation decisions in both experimental settings and a large-scale natural field experiment, we investigate the effect of "choice-option" defaults on the donation rate, average donation amount, and the resulting revenue. We find (1) a "lower-bar" effect, where defaulting a low amount increases donation rate, (2) a "scale-back" effect where low defaults reduce average donation amounts and (3) a "default-distraction" effect, where introducing any defaults reduces the effect of other cues, such as positive charity information. Contrary to the view that setting defaults will backfire, defaults increased revenue in our field study. However, our findings suggest that defaults can sometimes be a "self-cancelling" intervention, with countervailing effects of default option magnitude on decisions and resulting in no net effect on revenue. We discuss the implications of our findings for research on fundraising specifically, for choice architecture and behavioral interventions more generally, as well as for the use of "nudges" in policy decisions.


A Glimpse into the World of High Capacity Givers: Experimental Evidence from a University Capital Campaign

Tova Levin, Steven Levitt & John List

NBER Working Paper, March 2016

The wealthiest 10% of donors now give 90% of charitable dollars in the U.S., but little is known about what motivates them. Using a natural field experiment on over 5,000 high capacity donors, we find persistence in giving patterns, that signals of program quality influence giving, and that the price of giving is not unduly important. Unlike typical small donors, our givers respond only on the intensive margin, and often with a longer time lag. Our study highlights the value to practitioners of partnering with academics, as our intervention has generated $30 million in incremental donations to the University.


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