The Demand (or Lack Thereof) for Honest, Rigorous Impact Information in Charity
33 Pages Posted:
Date Written: March 16, 2020
Charities infrequently conduct rigorous evaluations of their impact, and they often treat impact evidence as proprietary. This paper investigates whether donor-driven market incentives can explain why nonprofit organizations routinely lack an evidentiary basis to justify their operations. Across three preregistered online survey experiments (N = 1,058), two domains (global health and human rights), and two types of interventions (medical care and issue-awareness), this paper finds that people do not reward exceptionally positive charitable impact, but they do punish charities that admit their programs were ineffective. Charities are only rewarded for revealing information about their impact when the results are unrealistic and unattainable. The results also demonstrate that donors are more sensitive to information about administrative overhead than they are to direct information about impact. These findings cast doubt on common explanations that suppose charities rarely conduct rigorous impact evaluations due to their costs or difficulty of measurement.
Keywords: evaluation, cost-effectiveness, randomized controlled trials, overhead
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