Selfish Giving: The Effect of Conditional Gifts on Donor Mindset and Charitable Donations
32 Pages Posted: 10 Jan 2020
Date Written: December 4, 2019
Non-profits regularly use conditional “thank-you” gifts to entice prospective donors to give, yet experimental evidence suggests their effects are mixed in practice. This paper uses a series of laboratory experiments to systematically test when and why thank-you gifts vary in effectiveness. We first demonstrate that although gifts often raise donations to unfamiliar or low-rated charities, many gifts had no effect or negative effects for charities that prospective donors already liked. Three additional experiments investigate the underlying mechanisms and find that the introduction of a thank-you gift shifts individuals from a prosocial mindset to a more selfish mindset, changing donation patterns. We additionally find that making gifts optional, as commonly seen in fundraising campaigns, did not change results. Altogether, these experiments suggest that small, token gifts can be effective when appealing to donors unfamiliar with the organization or their cause, such as during donor acquisition campaigns; however, these same gifts may have contrary effects on those who already favor the charity, such as recent donors. Changing to an optional gift yields similar results, likely because the gift offer still shifts the mindset with which individuals approach the decision.
Keywords: Altruism, Charitable Giving, Motivation Crowding Out, Self-Image, Signaling, Mindsets
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