The Effect of Status on Voluntary Contribution
33 Pages Posted: 8 Apr 2008
Date Written: April 2008
Abstract
Fundraisers often start their campaigns by soliciting the wealthier, more recognized and respected individuals in a community. We examine whether an explanation for such a solicitation ordering may be that people prefer to associate with those of higher social ranking than themselves. Using a simple linear example we demonstrate that concerns for status may give rise to an optimal solicitation ordering similar to that used by fundraisers. Aggregate contributions and earnings are larger when high-status donors are solicited before rather than after those of low status. To investigate this comparative static experimentally we induce a status differential in the laboratory and reverse the contribution order between high- and low-status participants. We find that low-status followers are likely to mimic contributions by high-status leaders and this encourages high status leaders to contribute. Contributions are therefore larger when individuals of high status contribute before, rather than after, those of low status.
Keywords: Charitable giving, social status, voluntary contribution games
JEL Classification: H00, C91, C72
Suggested Citation: Suggested Citation
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