Insuring Your Donation – An Experiment

Renate Buijze, Christoph Engel and Sigrid Hemels
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Renate Buijze: Erasmus University Rotterdam (EUR) - Erasmus School of Law
Sigrid Hemels: Erasmus University Rotterdam (EUR) - Erasmus School of Law

No 2015_16, Discussion Paper Series of the Max Planck Institute for Research on Collective Goods from Max Planck Institute for Research on Collective Goods

Abstract: An increasing fraction of donations is channeled through donation intermediaries. These entities serve multiple purposes, one of which seems to be providing donors with greater certainty: that the donation reaches its intended goal, and that the donor may be sure to get a tax benefit. We interpret this function as insurance and test the option to insure donations in the lab. Our participants indeed have a positive willingness to pay for insurance against either risk. Yet the insurance option is only critical for their willingness to donate to a charity if the uncertainty affects the proper use of their donation.

Keywords: Insurance; charity; Donation; donation intermediary (search for similar items in EconPapers)
JEL-codes: D03 D12 D64 G22 H25 H31 K34 L31 (search for similar items in EconPapers)
Date: 2015-10, Revised 2016-07
New Economics Papers: this item is included in nep-exp, nep-ias, nep-law and nep-upt
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Persistent link: https://EconPapers.repec.org/RePEc:mpg:wpaper:2015_16

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