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Decomposing desert and tangibility effects in a charitable giving experiment

Abstract

Several papers have documented that when subjects play with standard laboratory “endowments” they make less self-interested choices than when they use money they have either earned through a laboratory task or brought from outside the lab. In the context of a charitable giving experiment we decompose this into two common artifacts of the laboratory: the intangibility of money (or experimental currency units) promised on a computer screen relative to cash in hand, and the distinct treatment of random “windfall” gains relative to earned money. While both effects are found to be significant in non-parametric tests, the former effect, which has been neglected in previous studies, has a stronger impact on total donations, while the latter effect has a greater impact on the probability of donating. These results have clear implications for experimental design, and also suggest that the availability of more abstract payment methods may increase other-regarding behavior in the field.

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Correspondence to David Reinstein.

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Reinstein, D., Riener, G. Decomposing desert and tangibility effects in a charitable giving experiment. Exp Econ 15, 229–240 (2012). https://doi.org/10.1007/s10683-011-9298-0

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Keywords

  • House money effect
  • Experimental methodology
  • Tangibility
  • Public goods
  • Charitable giving
  • Individual choice
  • Altruism

JEL Classification

  • C91
  • D03
  • D64