Donations to US Based NGOs in International Development Cooperation: How (Un-)Informed are Private Donors?

29 Pages Posted: 10 Feb 2011

See all articles by Peter Nunnenkamp

Peter Nunnenkamp

University of Kiel

Hannes Öhler

University of Goettingen (Gottingen)

Date Written: February 8, 2011

Abstract

Apart from scaling up foreign aid by NGOs, informed choices of private donors could also encourage an efficient and targeted use of NGO funds in international development cooperation. We assess the determinants of private donations across a large sample of US based NGOs with foreign aid activities. OLS and 2SLS estimations indicate that donors hardly make use of publicly available information on NGO characteristics, notably the “price of giving” and the degree of specialization, when deciding on donations. They rather rely on the frequently offered option to designate donations to preferred purposes – even though this behavior would be rational only under conditions that are unlikely to hold.

Keywords: non-governmental organizations, specialization, private donations, informed choices, price of giving, option to designate

JEL Classification: L31, F35, D80

Suggested Citation

Nunnenkamp, Peter and Öhler, Hannes, Donations to US Based NGOs in International Development Cooperation: How (Un-)Informed are Private Donors? (February 8, 2011). Available at SSRN: https://ssrn.com/abstract=1757760 or http://dx.doi.org/10.2139/ssrn.1757760

Peter Nunnenkamp (Contact Author)

University of Kiel ( email )

D-24100 Kiel
Germany

Hannes Öhler

University of Goettingen (Gottingen) ( email )

Platz der Gottinger Sieben 3
Gottingen, D-37073
Germany

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