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Is giving to a charitable cause essentially equivalent to any other economic decision made by a human being, bounded by the same rational and irrational inputs as any other expenditure? Based on research by psychologist Deborah Small and others working in the area of philanthropy and altruism, the answer is a resounding no.

In this Social Science Bites podcast, Small, the Adrian C. Israel Professor of Marketing at Yale University, details some of the thought processes and outcomes that research provides about charitable giving. For example, she tells interviewer David Edmonds, that putting a face to the need – such as a specific hungry child or struggling parent – tends to be more successful at producing giving than does a statistic revealing that tens of thousands of children or mothers are similarly suffering.

This “identifiable victim effect,” as the phenomenon is dubbed, means that benefits of charity may be inequitably distributed and thus do less to provide succor than intended. “[T]he kind of paradox here,” Small explains, “is that we end up in many cases concentrating resources on one person or on certain causes that happened to be well represented by a single identifiable victim, when we could ultimately do a lot more good, or save a lot more lives, help a lot more people, if – psychologically — we were more motivated to care for ‘statistical’ victims.”

That particular effect is one of several Small discusses in the conversation. Another is the “drop in the bucket effect,” in which the magnitude of a problem makes individuals throw up their arms and not contribute rather than do even a small part toward remedying it.

Another phenomenon is the “braggarts dilemma,” in which giving is perceived as a good thing, but the person who notes their giving is seen as less admirable than the person whose gift is made without fanfare. And yet, the fact that someone goes public about their good deed can influence others to join in.

“[O]ne of the big lessons in marketing,” Small details, “is that word of mouth is really powerful. So, it’s much more effective if I tell you about a product that I really like than if the company tells you about the product, right? You trust me; I’m like you. And that’s a very effective form of persuasion, and it works for charities, too.”

Small joined the Yale School of Management in 2022, moving from the University of Pennsylvania’s Wharton School, where she had been the Laura and John J. Pomerantz Professor of Marketing since 2015. In 2018, she was a fellow of the American Psychological Society and a Marketing Science Institute Scholar.

To download an MP3 of this podcast, right-click HERE and save. The transcript of the conversation appears below.

For a complete listing of past Social Science Bites podcasts, click HERE. You can follow Bites on Twitter @socialscibites and David Edmonds @DavidEdmonds100.

TRANSCRIPT

David Edmonds: Profit-focused companies and charities have entirely different objectives – but certain things in common. Companies want to persuade customers to purchase their products. Charities want to persuade potential donors to give them money for the good causes they fund. Deborah Small is a professor of marketing at the Yale School of Management and has studied what motivates people to be altruistic. Deborah Small, welcome to Social Science Bites.

Deborah Small: Thanks so much for having me.

Edmonds: We’re talking today about charitable giving. Why do people give to charity? What works in persuading them to open their wallets? Now, I don’t normally ask interviewees why they’ve ended up in a particular discipline. But this is such a specific area, so I’m interested in what first attracted you to philanthropy as a research topic.

Small: A little bit of happenstance, I didn’t intend to study philanthropy, I was getting my PhD in judgment and decision-making. And so I was interested in biases in the way we make all sorts of judgments. And I was interested in public policy. And the first area of bias that kind of drew me in was bias in the value of human life. For a long time, I didn’t even think of myself as someone who studied philanthropy, and then that kind of brand was thrust upon me, I really thought of myself as studying questions around distortions and altruism and self-interest and how that affects our decision making. But, of course, the real-world analog of that is philanthropy. And it’s very practically important and useful for taking research into practice for teaching and basically being in the real world.

Edmonds: Let’s talk a bit about some of the research you’ve conducted, starting with what’s called the ‘identifiable victim effect.’ Before you tell us the findings of this research, you’d better define what the identifiable victim effect is.

Small: That term came from Thomas Schelling, who wrote about this, I think, very relatable tendency, we tend to focus our attention, our sympathy, and behavioral responses, oftentimes giving money when we learn about a specific identified victim. And yet, there’s evidently thousands, millions, of needy people around the world, who remain hidden to us, Schelling refers to them as statistical victims or statistical lives, that don’t move us in the same way.

And the kind of paradox here is that we end up in many cases concentrating resources on one person or on to certain causes that happened to be well represented by a single identifiable victim, when we could ultimately do a lot more good, or save a lot more lives, help a lot more people, if – psychologically — we were more motivated to care for statistical victims.

Edmonds: So that’s the definition of it.

Small: Yes.

Edmonds: What did you do to test it?

Smalls: We and other researchers have tested it in a variety of different ways. And in hindsight, now, sometimes I think this gets a bit confusing, because sometimes it’s operationalized by contrasting helping towards one victim versus helping towards some larger set of victims. And that’s certainly part of it.

Other times, it’s tested, including some my own work, by showing a picture of a particular victim in one case, versus statistics. In another case — perhaps the cleanest lab-based experimental test of this, which is also the most experimentally cleanest, which means it’s the most unnatural and most different from the real world way, is in a lab-based experiment — we have participants playing a version of the Dictator Game, where some participants are randomly assigned to get some sum of money, and then they’re matched with another anonymous person, they don’t meet this person, are never going to meet this person, they’re matched with someone else. And they’re given an option to give away any of the money for which they’ve just been endowed to this other anonymous person. And the way that we sought out to kind of cleanly test for identifiability was we enabled in one condition, so for some randomly determined set of participants, they drew the number of the person for whom they were matched before they made their decision. And then the other condition, the others flip a coin, those who flip tails instead of heads, they don’t learn the number of the person they’re matched with until after they’ve already made their decision of how much to give.

Now, in both of these cases, the number is meaningless because they know that that number can be any of the other people, they’re never going to find out who it is or anything like that. Nonetheless, when say imagine you draw number six, right before you made your decision, that person has now been determined. It is a specific certain person. It’s an anonymous person, but it’s a certain determined person.

And just that subtle manipulation affects how much people give in this Dictator Game. We used to call this determinateness. We think it’s kind of the most stripped-down part of the identifiable victim effect. You know, in the real world, being identifiable often means you learn information about a person and you see