Thoughts and Prayers - Do They Crowd out Donations?
46 Pages Posted: 15 Nov 2018
Date Written: September 28, 2018
Do thoughts and prayers crowd out monetary donations? Our theory implies thoughts should increase donations while the answer is ambiguous for prayers. Specifically, our theory suggests thoughts increase salience of donation recipients’ well-being, which unambiguously increases donations. Prayers generate two countervailing impacts—they decrease donations if the donor uses them as substitutes because he or she truly perceives that prayers directly improve the recipient’s well-being, but they increase donations if they make the recipient’s well-being more salient to the donor. Crowding out occurs if the perceived substitution effect dominates the salience effect. We explore which effect dominates empirically using donation experiments. In our main experiment, we provide potential donors the opportunity to donate money to hurricane Harvey victims. Our results suggest that praying does crowd out donations, but thoughts do not. This suggests the salience effect of thoughts is small in our context, and that prayers generate a larger substitution than salience effect. We conduct two follow-up experiments to examine the robustness of our main finding—that prayers crowd out donations. The results from those experiments imply the results in our main experiment are robust, but may be context dependent.
Keywords: thoughts; prayers; pro-social behavior; charity; economic experiment
JEL Classification: D12; D64
Suggested Citation: Suggested Citation