Review of Behavioral Economics > Vol 5 > Issue 1

How Low Can You Go? An Investigation into Matching Gifts in Fundraising

Sara Helms McCarty, Brock School of Business, Samford University, USA, smccarty@samford.edu Timothy M. Diette, Williams School of Commerce, Washington & Lee University, USA, DietteT@wlu.edu Betsy Bugg Holloway, Brock School of Business, Samford University, USA, bbhollow@samford.edu
 
Suggested Citation
Sara Helms McCarty, Timothy M. Diette and Betsy Bugg Holloway (2018), "How Low Can You Go? An Investigation into Matching Gifts in Fundraising", Review of Behavioral Economics: Vol. 5: No. 1, pp 23-37. http://dx.doi.org/10.1561/105.00000075

Published: 26 Mar 2018
© 2018 S. Helms McCarty, T. M. Diette and B. B. Holloway
 
Subjects
Behavioral Economics,  Consumer Behavior,  Marketing research,  Behavioral Decision Making
 
Keywords
JEL Codes: C93 Field ExperimentsD64 Altruism, PhilanthropyL31 Nonprofit Institutions, NGOsM31 Marketing
CharityDonationsNonprofitExperimentMatching offersIncentives
 

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In this article:
1. Introduction
2. Experiment Design
3. Results
4. Discussion and Conclusions
References

Abstract

There is a rich existing economic literature that considers the impact of matching offers on the behavior of donors to nonprofit organizations, both in the laboratory and in the field. We evaluate the impact of matching gift offers included in a nonpartisan nonprofit organization’s holiday mail fundraising drive. We add to the existing literature in two ways. First, our use of a nonpartisan nonprofit is uncommon. Second, prior literature establishes that more generous matches (beyond $1:$1) generally do not increase donations in a cost-effective way. However, few studies consider less generous offers. We evaluate the impact of a $1:$10 matching offer. Our results suggest that the nonprofit organization’s donors are not generally susceptible to matching offers, but that the $1:$1 match led to a higher response rate and larger gift than the $1:$10 match for legacy donors. We also find that donors more closely tied to the organization through prior giving are more likely to give in response to an ask without matching offers than donors without past giving. Our results suggest that low matching offers are not worth pursuing for many nonprofit organizations, and that the response to offers differs across regular donors to the organization compared to other donor types.

DOI:10.1561/105.00000075