Demand for Giving to Multiple Charities: Theory and Experiments
نویسندگان
چکیده
We study how competition among charities affects individuals’ giving behavior. We characterize a situation where a higher rebate subsidy shifts donations from one charity to another and increases total donations. We conduct two experiments: (i) individualized charitable giving where free riding incentives are shut down; and (ii) multi-donor charitable giving. We derive the demand for giving at different rebate conditions. Consistent with theory, the effect of competition on total donations is on average positive and its magnitude depends on the relative price. The social net benefit of rebate subsidies are calculated by comparing campaign costs and new donations generated.
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