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Journal Article

Insuring Your Donation – An Experiment

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Engel,  Christoph
Max Planck Institute for Research on Collective Goods, Max Planck Society;

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Citation

Buijze, R., Engel, C., & Hemels, S. (2017). Insuring Your Donation – An Experiment. Journal of Empirical Legal Studies, 14(4), 858-885.


Cite as: http://hdl.handle.net/11858/00-001M-0000-002D-7DC7-F
Abstract
An increasing fraction of donations is channeled through donation intermediaries. These entities serve multiple purposes, one of which seems to be providing donors with greater certainty: that the donation reaches its intended goal, and that the donor may be sure to get a tax benefit. We interpret this function as insurance and test the option to insure donations in the lab. Our participants indeed have a positive willingness to pay for insurance against either risk. Yet the insurance option is only critical for their willingness to donate to a charity if the uncertainty affects the proper use of their donation.