Too Many Charities? Insight from an Experiment with Multiple Public Goods and Contribution Thresholds

37 Pages Posted: 8 Aug 2013

See all articles by Luca Corazzini

Luca Corazzini

University of Padua - Department of Economics; Bocconi University - Department of Economics

Christopher Cotton

Queen's University, Department of Economics

Paola Valbonesi

University of Padua - Department of Economics and Management, DSEA

Date Written: August 7, 2013

Abstract

We present results from an experiment with multiple public goods, where each good produces benefits only if total contributions to it reach a minimum threshold. The experiment allows us to compare contributions in a benchmark treatment with a single public good and in treatments with more public goods than can be funded. The presence of multiple public goods makes coordination among participants more difficult, discouraging contributions, and decreasing the likelihood of any public good being effectively funded. Multiplicity decreases funding unless one public good stands out as being the most efficient alternative. Applied to the case of philanthropy, the results show how overall donations and the number of effectively funded charities may both decrease as the total number of charities increase. This is true even if the new charities offer higher potential benefits than previous options.

Keywords: Threshold public goods, multiple public goods, laboratory experiment, charities, fundraising

JEL Classification: C9, H4, L31

Suggested Citation

Corazzini, Luca and Cotton, Christopher and Valbonesi, Paola, Too Many Charities? Insight from an Experiment with Multiple Public Goods and Contribution Thresholds (August 7, 2013). Available at SSRN: https://ssrn.com/abstract=2307154 or http://dx.doi.org/10.2139/ssrn.2307154

Luca Corazzini

University of Padua - Department of Economics ( email )

via Del Santo 33
Padova, 35123
Italy

Bocconi University - Department of Economics ( email )

Via Gobbi 5
Milan, 20136
Italy

Christopher Cotton (Contact Author)

Queen's University, Department of Economics ( email )

Dunning Hall 230
Kingston, Ontario K7L 3N6
Canada

HOME PAGE: http://www.christophercotton.ca

Paola Valbonesi

University of Padua - Department of Economics and Management, DSEA ( email )

via Del Santo 33
Padova, 35123
Italy
+39+049+8274058 (Phone)

HOME PAGE: http://www.decon.unipd.it

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