Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/214963 
Year of Publication: 
2019
Series/Report no.: 
CESifo Working Paper No. 7961
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
Can social norms affect fundamental patterns of behavior such as income effects? Studies of determinants of giving to charities and other individuals yield a wide range of income-effect estimates. We conduct two experiments to first test whether the effect of income on charitable giving depends on whether the income is earned and then test whether any difference in the effects by income source can be explained by social norms. Our first experiment induces random variation in both earned income and windfall bonuses and shows that only bonuses increases charitable donations. The second experiment uses an incentivized coordination game to investigate whether social norms can explain this donation pattern. Perceptions of what most people would consider a morally appropriate donation depend on the amount of income and whether it is a windfall. The norms elicited in the second experiment match the donation patterns in the first experiment both overall and across subject demographics, pointing to social norms as a key determinant of charitable giving.
Subjects: 
charitable
donation
warm glow
social preferences
income effect
experiment
JEL: 
D01
D64
A13
Document Type: 
Working Paper
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