(The) effect of social information on donation decisions: a survey experiment

Abstract

In our survey experiment, we examine the effect of social information on donation decisions with exploring perception and misperceptions of other people's donation information. Before giving social information, respondents have to think of other people’s donation amounts as looking at the informaton of the lowest 10% decile group, median decile group, the top 10% decile group, and same income decile group: the top 10% income group will make donation more than the actual amount, the bottom 10%, median income group will make less donation than the actual amount, and same income group has a wide variety of guessed donation amount. After correcting people’s misperceptions, we find four main results. First, it has no impact on donation decision for people to guess the average amount of others or to know their exact income position. Second, there is a tendency to reduce their future donation amount as a whole when people know the other people’s average donation amounts. Third, the top 20 percent of donors in the last year will cut down their donation when they look at social information. Four, it makes people change their future donation amounts to correct their misunderstanding about their peer group: On the other hand, the social information about the highest group makes people donate more.