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Behavioural Insights and Charitable Giving
Charity comes from the heart. Yet some influences, seemingly unrelated to our altruistic preferences, can significantly impact how much and how often we give.
In partnership with a number of organisations, including the Charities Trust and the Charities Aid Foundation, we’ve published a paper on the Application of Behavioural Insights to Charitable Giving. It outlines some key insights from the behavioural science literature and reports the results from five randomised controlled trials that show how charitable donations have been increased in practice.
Someone who knows all about the power of giving is Professor Adam Grant from Wharton Business School. Adam recently stopped by to talk about his latest book, Give and Take, in which he argues that the key to success is to help others tirelessly. He says that whilst takers focus on their own success, givers create environments where others can uncover opportunities, collaborate and build relationships. He goes on to say that a key feature of true giving is not expecting anything in return. But, most people are ‘matchers’ – they reciprocate giving and punish taking, leaving givers ( ironically) to be better off in the long run.
Some evidence in his book comes from randomised controlled trials in which the ultimatum game is played: a player is instructed to offer another player a portion of money. The receiving player can accept (in which case both players take the money home) or reject (leaving both players with nothing). Most receivers start to reject offers when they become ‘unfair’ (usually when they receive less than 40% of the money at stake). Furthermore, receivers prefer splitting $10 evenly with a fair player (someone who made fair offers other players in the past) to splitting $12 evenly with an unfair player.
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