TY  - CHAP
AB  - An individual should be indifferent between a rebate subsidy of rate sr and a matching subsidy of rate sm=sr/(1-sr), and the total amount received by the charity should be the same regardless of subsidy type. Recent laboratory and field experiments contradict these straightforward predictions of standard economic theory: subjects consistently make decisions that result in larger amounts going to the charity under a matching subsidy than under an equivalent rebate subsidy. This paper tests whether this result is due to rebate-aversion – a preference by donors for a match over a rebate subsidy. Consistent with theory, we find no significant preference for one or the other subsidy scheme. However, we do find that, as in previous studies, participants selecting the matching subsidy made decisions that resulted in approximately twice the donations of participants selecting the rebate subsidy donated.
VL  - 11
SN  - 978-0-76231-301-3, 978-1-84950-406-5/0193-2306
DO  - 10.1016/S0193-2306(06)11007-8
UR  - https://doi.org/10.1016/S0193-2306(06)11007-8
AU  - Eckel Catherine C.
AU  - Grossman Philip J.
ED  - R. Mark Isaac
ED  - Douglas D. Davis
PY  - 2006
Y1  - 2006/01/01
TI  - Do Donors Care about Subsidy Type? An Experimental Study
T2  - Experiments Investigating Fundraising and Charitable Contributors
T3  - Research in Experimental Economics
PB  - Emerald Group Publishing Limited
SP  - 157
EP  - 175
Y2  - 2024/09/19
ER  -