(Un)Informed charitable giving | Academic Article individual record
abstract

Evidence suggests little informed giving. To understand this behavior, we examine voluntary provision of a discrete public good with independent private values that can be ascertained at a cost. We find that an individual who considers a smaller contribution is less likely to learn her value, and thus the percentage of informed giving diminishes as the population grows. We also find that a direct grant to the charity exacerbates crowding-out by discouraging information acquisition whereas a matching grant increases donations by encouraging it. We further show that with costly information, a (first-order) stochastic increase in values can decrease donations; and that facilitating private acquisition of information can be a better fund-raising strategy than directly supplying it. © 2013 Elsevier B.V.

author list (cited authors)
Krasteva, S., & Yildirim, H.
publication date
2013
publisher
Elsevier bv Publisher
published in
keywords
  • Crowding-out
  • Warm-glow
  • Search Cost
  • Value Of Information
  • Charitable Giving