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Transactions Costs and Social Distance in Philanthropy: Evidence from a Field Experiment

Jonathan Meer () and Oren Rigbi ()

No 1205, Working Papers from Ben-Gurion University of the Negev, Department of Economics

Abstract: The importance of various motivations for altruistic behavior is still an open question. We use data from a field experiment at Kiva, the online microfinance platform, to examine the role of transactions costs and social distance in philanthropy. Requests for loans are either written in English or another language, and our treatment consists of posting requests in the latter category with or without translation. We find evidence that relatively small transactions costs have a large effect on the share of funding coming from speakers of languages other than that in which the request was written. Social distance plays a smaller role in funding decisions. Additionally, our results demonstrate the importance of a lingua franca.

Keywords: Charitable Giving; Social Distance; Philanthropy; Translation; Transaction Costs; Microfinance (search for similar items in EconPapers)
JEL-codes: D23 D64 G21 (search for similar items in EconPapers)
Pages: 65 pages
Date: 2012
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