Wednesday, July 03, 2002

I've been influenced by Landsburg's argument that the most effective use of one's charitable $$ is to donate all of it to the most effective charity. This idea runs counter to most regular peoples' giving habits, where they give small to medium donations to a variety of organizations when reminded or canvassed. It's been a useful idea to me because it inspired me to do research into effective charities so that I could pick one I really liked, and give it most of my charitable funds.

However, the idea falls down if one takes into account the other reasons charities want donations, as Natasha pointed out to me this weekend. Charities regularly canvas people for extremely small amounts of money, hardly enough to cover the canvassing costs. Here are some reasons why charities want large amounts of small donors:

  • A large population of small donors shows enough popular support to attract a few much bigger donors.
  • Proof of popular support can help attract government funding
  • Proof of popular support can assist in advocacy, whether the advocacy is targetted at government, corporate, or other
  • Even small donations commit people. In Influence, Power of Persuasion, Cialdini describes how people who previously did not have a deep commitment to a cause become more committed after donating a small amount of money. This may lead to larger donations or other contributions later. Unlike the previous three points, this point may influence you not to donate small amounts.
  • Small donations may prove an interest in learning more. The charity may highly value a role of informing people who have already shown some interest, rather than simply extract more money from them. The small charitable donation may be just large enough to cover the cost of a member's newsletter.

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