Stochastic Income and Conditional Generosity

Christian Kellner, David Reinstein, Gerhard Riener
2015 Social Science Research Network  
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more » ... bedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Abstract We study how other-regarding behavior extends to environments with uncertain income and conditional commitments. Should fundraisers ask a banker to donate "if he earns a bonus" or wait and ask after the bonus is known? Standard EU theory predicts these are equivalent; loss-aversion and signaling models both predict a larger commitment before the bonus is known; theories of affect predict the reverse. In field and lab experiments, we allow people to donate from lottery winnings, varying whether they decide before or after learning the lottery's outcome. Males are more generous when making conditional donations before knowing the outcome, while females' donations are unaffected. Males also commit more in treatments where income is certain but the donation's collection is uncertain. This supports a signaling explanation: it is cheaper to commit to donate before the uncertainty is unresolved, thus a larger donation is required to maintain a positive image. This has implications for experimental methodology, for fundraisers, and for our understanding of pro-social behavior. ; +44 1206 87 3518; Riener, Mannheim and DICE, Düsseldorf. Acknowledgments: We would like to thank the the Universities of Essex, Düsseldorf, Mannheim and Bonn for providing financial support for our research. We would also like to thank the many colleagues and seminar and conference participants who have offered us valuable advice and comments, including
doi:10.2139/ssrn.2691027 fatcat:ddj7letq55birmu2xz56kgxdqe