EconPapers    
Economics at your fingertips  
 

Rational Inattention to Subsidies for Charitable Contributions

Sarah Smith
Authors registered in the RePEc Author Service: Kimberley Scharf

CAGE Online Working Paper Series from Competitive Advantage in the Global Economy (CAGE)

Abstract: Evidence shows that individuals do not always take tax attributes into account when making their choices. We focus on tax relief for charitable contributions. Although rational donors should view a match and a rebate of the same value as being equivalent, survey evidence shows that nominal donations are more likely to adjust in response to a change in the rebate than to a corresponding change in the match. We argue that these patterns are consistent with the predictions of a model of rational inattention, whereby a majority of individuals choose to process rebate changes while forgoing to process match changes.

Keywords: Salience of Taxes and Subsidies; Rational Inattention (search for similar items in EconPapers)
Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www2.warwick.ac.uk/fac/soc/economics/resear ... _scharf_rational.pdf

Related works:
Working Paper: Rational Inattention to Subsidies for Charitable Contributions (2011) Downloads
Working Paper: Rational Inattention to Subsidies for Charitable Contributions (2010) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cge:wacage:02

Access Statistics for this paper

More papers in CAGE Online Working Paper Series from Competitive Advantage in the Global Economy (CAGE) Contact information at EDIRC.
Bibliographic data for series maintained by Jane Snape ().

 
Page updated 2019-12-08
Handle: RePEc:cge:wacage:02