Abstract

http://ssrn.com/abstract=1708745
 
 

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Charity as a Signal of Trustworthiness


Sebastian Fehrler


University of Zurich, Center for Comparative and International Studies (CIS); IZA


IZA Discussion Paper No. 5299

Abstract:     
Being perceived as trustworthy comes with substantial economic benefits in many situations. Making other people think you are a trustworthy person may, therefore, be an important motive for charity and other forms of prosocial behavior, provided these activities work as signals of trustworthiness. This paper shows that donating money to an NGO substantially raises the other players' beliefs about the donorsメ trustworthiness in a simple trust game. Consequently, donors receive higher transfers. The magnitude of these benefits is substantial.

Number of Pages in PDF File: 19

Keywords: charity, signaling, trust, trustworthiness

JEL Classification: C72, C92, H41

working papers series





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Date posted: November 14, 2010  

Suggested Citation

Fehrler, Sebastian, Charity as a Signal of Trustworthiness. IZA Discussion Paper No. 5299. Available at SSRN: http://ssrn.com/abstract=1708745

Contact Information

Sebastian Fehrler (Contact Author)
University of Zurich, Center for Comparative and International Studies (CIS) ( email )
Affolternstrasse 56
8050 Zurich
Switzerland
IZA ( email )
P.O. Box 7240
Bonn, D-53072
Germany
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