Transaction Costs, the Opportunity Cost of Time and Inertia in Charitable Giving

Stephen Knowles () and Maroš Servátka

Working Papers in Economics from University of Canterbury, Department of Economics and Finance

Abstract: We conduct a laboratory experiment to analyze the effect transactions costs and inertia have on charitable giving. We conjecture that transaction costs will have a greater effect on donations if the solicitation is received when the opportunity cost of time is high. Inertia could become a factor if people intend to give, but postpone making the payment until they have more time, and having postponed making the donation once, keep doing so. We find evidence of a transaction cost effect, with the size of this effect depending on the opportunity cost of time, but no statistically significant inertia effect.

Keywords: Charitable giving; dictator game; transaction costs; opportunity cost of time; inertia (search for similar items in EconPapers)
JEL-codes: C91 D64 (search for similar items in EconPapers)
Pages: 44 pages
Date: 2014-01-01
New Economics Papers: this item is included in nep-exp, nep-soc and nep-sog
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Transaction costs, the Opportunity Cost of Time and Inertia in Charitable Giving (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:cbt:econwp:14/05

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