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Impure Impact Giving: Theory and Evidence

Daniel Hungerman and Mark Ottoni-Wilhelm

Journal of Political Economy, 2021, vol. 129, issue 5, 1553 - 1614

Abstract: We present a new model of charitable giving where individuals regard out-of-pocket donations and the matches they induce as different. We show that match-price elasticities combine conventional price effects with the strength of warm glow, so that a match-price elasticity alone is insufficient to characterize preferences for giving. Match- and rebate-price elasticities will be different, but together they lead to new tests of underlying giving preferences. We estimate, for the first time, a match-price elasticity in a high-stakes setting together with a rebate elasticity induced by tax policy. The estimates reject extant models of giving but are consistent with the new theory.

Date: 2021
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Citations: View citations in EconPapers (15)

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Working Paper: Impure Impact Giving: Theory and Evidence (2018) Downloads
Working Paper: Impure Impact Giving: Theory and Evidence (2018) Downloads
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