Working Paper: NBER ID: w14941
Authors: Andreas Lange; Andrew Stocking
Abstract: Despite the increasing use by charities, significant uncertainty exists about optimal online fundraising mechanisms, especially when large donor pools show substantial heterogeneities. We use an online natural field experiment with over 700,000 subjects to test theory on price discounts and show large differences in donation behavior between donors who have previously given money and/or volunteered. For example, framing the charity's membership price as a discount increases response rates and decreases conditional contributions from former volunteers, but not from past money donors. Our study thereby demonstrates the importance of conditioning fundraising strategies on the specifics of past donation dimensions.
Keywords: charitable donations; field experiment; price discounts; donor behavior
JEL Codes: C93; H41; L30
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Framing a membership price of $25 as a discount from a standard price of $35 (D49) | Increases response rates of potential donors (C83) |
| Framing a membership price of $25 as a discount from a standard price of $35 (D49) | Decreases conditional contributions (D64) |
| Previous donation history (D64) | Affects response to discount framing (D91) |