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October 31, 2014

Donors Are 80% More Likely to Donate if Entire Gift Goes to a Cause

Donors are much more likely to give if they believe their money will not be spent on organizational overhead costs, and they are even more likely to donate if a matching gift is involved, according to two experiments, Science reports.

Uri Gneezy, an economist at the Rady School of Management at the University of California, San Diego, recently ran experiments examining how individuals responded to various types of donation information. In one experiment, when donors were told that overhead was covered by another donor and all their money would go directly to the cause, they were 80 percent more likely to give. When overhead was already covered and a matching contribution was involved, they were 94 percent more likely to give.

In another experiment, removing overhead boosted total donations by 64 percent. Daniel Oppenheimer, a psychologist at UCLA, observed that this was "a very clever study with obvious real-world implications."  The challenge, however, is finding donors willing to cover overhead, because "large donors don't like overhead any more than other donors."