Results of a new study by three American Universities demonstrate that people’s motivations for giving to charity are inherently selfish.
A number of collaborative studies conducted by behavioural scientists from Chicago Booth, London Business School, the University of Pennsylvania and NYU Stern School of Business looked at the way in which people give to charity.
Even when people are presented with more effective donation alternatives, they still pick the one they prefer, according to a paper - exclusively provided to indy100 - entitled Impediments to Effective Altruism: The Role of Subjective Preferences in Charitable Giving.
The first study had 126 participants evaluate how they believe they should make decisions based on six decision domains: choosing a charity, an investment, a cell phone, a restaurant, a piece of art, and a medical treatment. Then, they were given a number of statements and asked to what extent they agreed with each. For example: ‘It is important that the _____ I choose reflects my personal tastes or values’.
Participants indicated that it was “more important to rely on one’s subjective preferences, rather than objective metrics, when choosing a charity.”
In other words, people argued that it was more important to choose a charity you liked, rather than one that is proven to be effective.
Another study recruited 401 mostly male participants. They were asked to imagine either that they were donating $250 (£184) to charity, or investing it in stock through a website recommended by a friend.
Those who got a charity option were told the website organised its charity-giving into six categories: alternative energy, cancer, education, food, housing, and international, and that it was “renowned for being extremely accurate in evaluating which charities [stocks] are the most effective”.
They were asked to sort their options either by effectiveness or category type.
Sorting by effectiveness suggested that an individual was primarily concerned with selecting one of the most effective charities or investments, whereas sorting by category suggested that an individual was primarily concerned with selecting a charity or an investment that reflected a preferred option type.
The results once again found that people were more likely to pick the charity they liked, even when faced with evidence that other charities are more effective.
Significantly fewer participants chose to sort by effectiveness rating in the charity condition (67.8%) than in the investment condition.
Authors of the study concluded that deciding to give to charity on 'feeling' alone may not be useful.
These findings are more consistent with the theory of “warm-glow” giving, which argues that individuals gain utility from committing instances of generous acts but are insensitive to the benefits created by the acts (Andreoni, 1990).
Our results suggest that one reason that individuals are insensitive to the magnitude of benefits is how they construe charity, believing it is a relatively subjective decision and not one that should be made solely by consulting the numbers.
According to NPT-UK, 61 per cent of people in the UK donated to a charity last year, and there were 355 donations of more than £1 million in 2015. An estimated £2bn is donated by Independent Trusts and Foundations in London per year.
With so much money being given to charities, it is important to consider where that money goes and how effective the charity you are giving to is with its donations.