Perception of generosity under matching and rebate subsidies

Abstract

Existing evidence from laboratory experiments finds that a match is likely to increase charitable donations by more than a theoretically equivalent rebate. A number of explanations have been proposed for this in the literature. One idea, which has never been tested, is that people consider a match to be more generous, because unlike the rebate, there is no reward for making a donation in the match setting. We design a survey to determine whether people do consider matches more generous than rebates, and probe the reasons subjects give for their answers. We find that a significant number of people do consider rebates less generous because of the reward associated with donations in such a setting.