Information, Competition, and the Quality of Charities
Date
2015-05-16
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Abstract
We propose a model of charity competition in which informed giving alone can explain quality heterogeneity across similar charities. It is this heterogeneity that also creates the demand for information. In equilibrium, too few donors pay to be informed; but interestingly, informed giving may increase with the cost of information. This is true if the charitable market is highly competitive or if private consumption is a strong substitute to giving -- both of which are supported by evidence.
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Scholars@Duke
Huseyin Yildirim
Professor Yildirim joined Duke Economics in 2000 after receiving a Ph.D. from the University of Florida. He is an applied microeconomic theorist with broad interests. He has written on such varied topics as dynamic procurement auctions, charitable fundraising, committee design, and, most recently, career concerns in teamwork and tournaments. His work has appeared in top economics journals, including American Economic Review, Review of Economic Studies, Journal of Economic Theory, and RAND Journal of Economics.
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