Toward a Theory of Charitable Fund-Raising

A Theory of Charitable Fund-raising with Costly Solicititations

We present a theory of charitable fund-raising in which it is costly to solicit donors. We fully characterize the optimal solicitation strategy that maximizes donations net of fundraising costs. The optimal strategy dictates that the fund-raiser target only those individuals whose equilibrium contributions exceed their solicitation costs. We show that as the income inequality increases, so does...

Using Lotteries to Finance Public Goods : Theory and Experimental

This study explores the economics of charitable fund-raising. We begin by developing theory that examines the optimal lottery design while explicitly relaxing both risk-neutrality and preference homogeneity assumptions. We test our theory using a battery of experimental treatments and find that our theoretical predictions are largely confirmed. Specifically, we find that singleand multiple-priz...

comparing charitable fundraising schemes : evidence from a natural field experiment and a structural model ¤

Public Goods Experiments Without Confidentiality: A Glimpse into Fund-Raising∗

Laboratory researchers in economics assiduously protect the confidentiality of subjects. Why? Presumably because they fear that the social consequences of identifying subjects and their choices would significantly alter the economic incentives of the game. But these may be the same social effects that institutions, like charitable fund-raising, are manipulating to help overcome free riding and ...

The Impact of Social Comparisons on Nonprofit Fundraising

Why individuals make charitable contributions and voluntarily provide public goods is an important question in modern society. Extensive research on voluntary contributions has been conducted by economists (Davis & Holt, 1993; Ledyard, 1995) and psychologists (Dawes, 1980). Many theories have been proposed to explain why individuals give (or cooperate) when it is in their own (financial) intere...