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Matching Donations Without Crowding Out?

Maja Adena () and Steffen Huck ()

No 16, Rationality and Competition Discussion Paper Series from CRC TRR 190 Rationality and Competition

Abstract: Is there a way of matching donations that avoids crowding out? We introduce a novel matching method where the matched amount is allocated to a different project, present some simple theoretical considerations that predict reduced crowding out or crowding in (depending on the degree of substitutability between the two projects) and present evidence from a large-scale natural field experiment and a laboratory experiment. Similar to findings in the literature, conventional matching for the same project results in partial crowding out in the field experiment and, as predicted, crowding out is reduced under the novel matching scheme. The lab experiment provides more fine-tuned evidence for the change in crowding and yields further support for the theory: the novel matching method works best when the two projects are complements rather than substitutes.

Keywords: charitable giving; matched fundraising; natural field experiment (search for similar items in EconPapers)
JEL-codes: C93 D12 D64 (search for similar items in EconPapers)
Date: 2017-03-25
New Economics Papers: this item is included in nep-cbe, nep-exp and nep-ppm
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