Why people give to charities that they know don’t do the best work.

I’m a big fan of the Freakonomics Blog generally – but this post:Charity “Shoppers” vs. Charity Investors [http://freakonomics.com/] deserves reading by everyone working in the charity sector (which I understand is quite a lot of my readership).

I like Indian food more than sushi. And I like sushi more than Italian food. When going out for dinner and choosing which to eat, does this mean I always choose Indian? Of course not. I’d tire of Indian food.

On my savings account, I like earning 3% interest more than 2%. And I like earning 2% more than 1%. Suppose three banks offer accounts identical except for the interest rate: would I always choose the 3% account? Or might I say, “Hey, 3% is boring, I think I’ll try 2%?” Of course not. I’d stick with the bigger payoff.

Yet when it comes to charitable giving, most people spread their money around. Why is this?

Go and read the rest at Charity “Shoppers” vs. Charity Investors.

British readers can compare and contrast with this:

New Philanthropy Capital (NPC) has calculated that more than 7 million women have been affected by domestic violence but found that Refuge, the Women’s Aid Federation and Eaves Housing for Women have a combined annual income of just £17m. By contrast the Donkey Sanctuary, which has looked after 12,000 donkeys, received £20m in 2006.

Which is from this guardian article.

Leave a Reply