Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/223763
Authors: 
Castillo, Marco
Petrie, Ragan
Year of Publication: 
2020
Series/Report no.: 
IZA Discussion Papers No. 13321
Abstract: 
We examine optimal incentives for charitable giving with a large-scale field experiment involving 26 charities and over 112,000 unique individuals. The price of giving is varied by offering a fixed match if the donation meets a threshold amount (e.g. "give at least $25 and the charity receives a $25 match"). Responses are used to structurally estimate a model of charitable giving. The model estimates are employed to evaluate the effectiveness of various counterfactual match incentive schemes, taking into account the goals of the charity and donor preferences. Two of these optimal incentives were subsequently implemented in a follow-up field study. They were found to be effective at implementing the desired goals, as predicted by theory and our simulations. Our findings highlight the pitfalls of relying on a particular parameterization of a policy to evaluate effectiveness. The best-guess incentives in our initial field experiment turned out to be ineffective at increasing donations because optimal incentives should have been set higher.
Subjects: 
charitable giving
mechanism design
field experiment
JEL: 
D64
H41
C93
D91
Document Type: 
Working Paper

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