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Should We Tell People That Giving Makes Them Happier?

11 Post author: peter_hurford 04 September 2013 09:22PM

Why do people give to charity?

It seems strange to even ask. Most people would point to the fact that they’re altruistic and want to make a difference. Others are concerned with inequality and justice. Another group points to the concept of “paying it forward” or repaying a debt to society. Other explanations cite various religious or social reasons.

Not too many people cite the fact that giving makes them happier. Even if people agree this is true, I don’t often hear it as people’s main reason. Instead, it’s more like a beneficial side effect. In fact, it seems pretty odd to me to hear someone boldly proclaim that they give only because it makes them happier, even if it might be true.

 

But if it’s true that giving does make people happier, should we be promoting that publicly and loudly?  Luke's article "Optimal Philanthropy for Human Beings" suggests that we should tell people to enjoy the happiness that giving brings.  Perhaps it might make a great opportunity to tap into groups who wouldn’t consider giving otherwise or have misconceptions that giving would make them miserable?

However, I’m a bit worried about how it might affect people’s incentives.  In this essay, I follow the evidence provided in the Harvard Business School working paper "Feeling Good About Giving: The Benefits (and Costs) of Self-Interested Charitable Behavior" by Lalin Anik, Lara B. Aknin, Michael I. Norton, and Elizabeth W. Dunn. Overall, in light of potential incentive effects, I think caution and further investigation is warranted when promoting the happiness side of giving.

 

Giving and Happiness

Giving What We Can has published its own review of research on happiness and giving and find a pretty strong connection. And it’s true -- lots of evidence confirms the connection and even indicates that it’s a causal relationship rather than a misleading correlation. In fact, it goes in both directions -- giving makes people happier and happier people are more likely to give[1].

Neurological studies of people found that people experienced pleasure when they saw money go to charity, even when it wasn’t their own, but experienced even more pleasure when they gave to charity directly[2], a conclusion that has been backed up with revealed preference tests in the lab[3, 4].

This connection has also been backed up in numerous experimental studies. Asking people to commit random acts of kindness can significantly increase self-reported levels of happiness compared to a control group[5]. Further research found that the amount people spent on gifts for others and donations to charity correlates with their self-reported happiness, while the amount they spent on bills, expenses, and gifts for themselves did not[6]. Additionally, people given money and randomly assigned to spend money on others were happier than those randomly assigned to spend the same amount of money on themselves[7].

 

Altering Incentives

People generally believe that spending on themselves will make them much happier than spending on others[6], which, given that this isn’t the case, means there is plenty of room for changing people’s minds. However, any social scientist or avid reader of Freakonomics knows that altering incentives can create unintended effects. So is there a potential harm in getting people to do more giving via advertising self-interested motive?

The classic example is that of the childcare center that had problems with parents who were late to pick up their children. They reasoned that if they charged fines, parents would stop being late, because they would have an economic incentive not to. They found instead, however, that introducing a fine actually created even more tardiness[8], presumably because what once was seen as rude and bad faith now could be made up for with a small economic cost. More surprisingly, the amount of lateness did not return to pre-fine levels even after the owners stopped the policy[9].

Other studies have found similar effects. A study of 3-5 year old nursery students who all initially seemed intrinsically interested in various activities were randomly put into three groups. One group made a pre-arranged deal to do a one of the activities in which they seemed interested in exchange for a reward, another group was surprised with a reward after doing the activity in question, and the third group was not rewarded at all. Those who were given an award upfront ended up significantly less intrinsically interested in the task than the other groups after the study was finished[10]. A similar study found that students who were interested in solving puzzles stopped solving those puzzles after a period ended where they were paid to solve puzzles[11].

 

In general, money and reminders of money tend to make people less pro-social[12]. This has also been found to some degree specifically in the world of charity. In a randomized field experiment, donors were encouraged to donate to disaster relief in the US and were randomly either enticed with an offer of donation matching or not. The study found that while people donated more often with the promise of donation matching, their contributions after the donation matching dropped below the control group, ending with a negative net effect overall[13].

Another study found that when gifts were sent out to donors, larger gifts resulted in a larger response rate of returned donations, but yielded a smaller average donation[14], though I suppose this could just be because more people who usually would give nothing were giving a small amount, bringing the average down. More importantly, this study found no net decrease in future donations after gifts were no longer sent out; instead, donations returned to their normal levels[14].

And certainly it’s worth noting some times when appeals to self-interest are successful. I couldn’t find any studies where this was the case. However, there is one anecdotal example: as Nick Cooney points out in "Self-Interest Can Make the World a Better Place -- For Animals, At Least", reduction in people eating factory farmed meat is coming almost entirely from people motivated not by concern for animal cruelty, but concern for their own health. Could advocating self-interested donations be the same as advocating health-motivated vegetarianism?

 

Opportunities for Further Investigation

It’s not very good to just let things be unclear if they don’t have to be, and I think we can resolve this issue with more scientific study. For example, one could randomly select one group to receive information about giving and happiness, another group to receive other standard arguments for giving, and a control group to receive no arguments or information about giving at all, and track their donation habits in a longitudinal study. This study would have it’s complications for sure, but could help see if information about giving and happiness backfires or not.

Or perhaps one could perform a field experiment. You could set up a booth asking people to donate to your cause and randomly include information about giving and happiness or not in your pitch and see how this affects immediate and long-term contributions. Doing this would have added advantages of being much quicker to run and not leading to people donating only because they think they’re being observed.

 

References

[1]: Anik, Lalin, Lara B. Aknin, Michael I. Norton, Elizabeth W. Dunn. 2009. “Feeling Good about Giving: The Benefits (and Costs) of Self-Interested Charitable Behavior”. Harvard Business School Working Paper 10-012.

[2]: Harbaugh, William T. 2007. "Neural Responses to Taxation and Voluntary Giving Reveal Motives for Charitable Donations." Science 316: 1622-1625.

[3]: Andreoni, James, William T. Harbaugh, and Lise Vesterlund. 2007. "Altruism in Experiments". New Palgrave Dictionary of Economics.

[4]: Mayr, Ulrich, William T. Harbaugh , and Dharol Tankersley. 2008. "Neuroeconomics of Charitable Giving and Philanthropy". In Glimcher, Paul W., Ernest Fehr, Colin Camerer, and Russel Alan Poldrack (eds.) 2009. Neuroeconomics: Decision Making and the Brain. Academic Press: London.

[5]: Lyubomirsky, Sonja, Kennon M. Sheldon, and David Schkade. 2005. "Pursuing Happiness: The Architecture of Sustainable Change." Review of General Psychology 9 (2): 111–131.

[6]: Akin, Lara B., et. al. 2010. "Pro-social Spending And Well-Being: Cross-Cultural Evidence for a Psychological Universal." National Bureau of Economic Research Working Paper #16415.

[7]: Dunn, Elizabeth W., Lara B. Aknin, and Michael I. Norton. 2008. “Spending Money on Others Promotes Happiness.” Science 319: 1687-1688.

[8]: Gneezy, Uri and Aldo Rustichini. 2000a. “A fine is a price.” Journal of Legal Studies 29: 1-18.

[9]: Gneezy, Uri and Aldo Rustichini. 2000b. “Pay enough or don't pay at all.” Quarterly Journal of Economics 115: 791-810.

[10]: Lepper, Mark R., David Greene, and Richard E. Nisbett. 1973. “Undermining Children's Intrinsic Interest with Extrinsic Reward: A Test of the ‘Overjustification’ Hypothesis.” Journal of Personality and Social Psychology 28(1): 129-137.

[11]: Deci, Edward L. 1971. “Effects of Externally Mediated Rewards on Intrinsic Motivation.” Journal of Personality and Social Psychology 18(1): 105-115.

[12]: Vohs, Kathleen D., Nicole L. Mead, and Miranda R. Goode. 2006. “The Psychological Consequences of Money”. Science 17 (314): 1154-1156.

[13]: Meier, Stephan. 2007. “Do Subsidies Increase Charitable Giving in the Long Run? Matching Donations in a Field Experiment”. Federal Reserve Bank of Boston Working Paper #06-18.

[14]: Falk, Armin. 2005. “Gift Exchange in the Field”. University of Bonn.

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(This essay is also cross-posted on the Giving What We Can blog and my blog.)

Comments (27)

Comment author: ahbwramc 05 September 2013 03:29:15AM 16 points [-]

I'm curious, have other people here found that giving makes them happier? I generally haven't found that to be the case. A typically givewell donation for me: a) reminds me that there's an obscene amount of suffering out there that I'm ignoring 99% of the time, and b) makes me feel guilty for not giving away more. I mean, I guess it makes me happier than not giving, since I'd feel even more guilty then. But in general it seems to me like the Peter Singer/Givewell/Effective Altruism approach to charity doesn't really lend itself to "feel-good" giving. More like, "soothe your conscience very slightly" giving.

Comment author: kbaxter 07 September 2013 12:09:47PM *  6 points [-]

I have the same issue. My solution is to set aside a block of money to give away, 80% of which goes to GiveWell's top choice and 20% of which I give away trying to maximize warm fuzzies. The warm fuzzies money ends up going to things like coworkers' fund raisers, friends who need it, NPR, and local causes I feel emotionally drawn to.

I'm pretty sure the warm fuzzies I get don't scale linearly with dollar amount, so I prefer to give lots of small amounts from the 20% instead of bulk-donating it to one thing. Ideally I would find a way to calibrate myself so I get the most warm fuzzies from giving to the most effective charities, but I haven't had success with that yet.

Comment author: [deleted] 06 September 2013 12:08:25PM 2 points [-]

As an ignorant child and young adult, giving small amounts of money made me slightly happier. It made me feel good about myself and I vastly overestimated the effect.

The moderate sums I later gave for explicitly utilitarian reasons didn't buy me as much happiness as self-centered spending would have. I'm hoping they bought more total happiness though.

Giving nontrivial money is like swimming upstream for me, motivationally speaking. The motivation is further decreased by knowledge of man-made inefficiencies, e.g. bans on taboo but pareto-improving voluntary exchange (example: for the right amount of money, I would gladly donate one of my kidneys).

Really effective causes tend to have speculative or otherwise indirect elements to them. For instance, veg*anism advocacy to reduce animal suffering or research funding for high-stakes topics. These may make most utilitarian sense, but they are less about allocating resources and more about putting some faith into causalities that may well be false. You pay, you get ads, but from there there's still a jump to actual reductions of actual suffering. You pay, you get funds for research institutions, but from there there's still a jump to actual applications that improve lives etc.

Comment author: John_Maxwell_IV 09 September 2013 01:38:41AM 2 points [-]

Try thinking of units of expected value as things you are purchasing with your giving?

Comment author: [deleted] 09 September 2013 11:17:38AM 1 point [-]

Yes, I know. It's less about somewhat realistic expectations and more about visceral motivation. Especially when other people's choices are involved (meat consumption, using research in the rights ways, improvements that only pan out if people are somewhat rational and benevolent etc).

Technically, we can treat other people as systems to be manipulated, and I guess it even works. But psychologically, it feels dissatisfying. In addition, it feels low status, as it gives others the power to destroy my money's worth. This is even true for crucial research, the applications of which can just be banned, never used in benevolent ways, rejected by an irrational public for bad reasons, etc.

The methods to measure probabilities and impacts are also somewhat unclear to me. As is estimating unintended consequences.

Comment author: kalium 06 September 2013 05:10:59AM 2 points [-]

Giving to friends and family makes me happier because I get warm fuzzies and because social ties are strengthened, and sometimes because a more efficient outcome has been reached (e.g. while looking for something else in a thrift store I find for $1 an attractive article of clothing in the recipient's size and favorite color).

Giving to charity does not make me happier. In fact, the last time I gave to charity I felt guilty because my family could have used that money. Volunteering might make me happier (at least I wouldn't be effectively taking money away from someone I care about) but I haven't tried it yet so I don't know.

Comment author: Grant 06 September 2013 03:14:39AM 1 point [-]

I haven't found that to be the case with personal gifts either. I spend a lot of time trying to pick out good gifts, and generally seem to fail. It just seems so very much easier for someone to pick out something they enjoy for themselves than it is for someone else to do it. I find most gifts given to me undesirable, but still have to look happy and grateful to receive them. The majority of the time I'd rather not have gotten or given any gifts at all.

I keep trying to get friends and family to forgo the normal gift-giving holidays in favor of giving to charity, with limited success.

Comment author: John_Maxwell_IV 09 September 2013 01:37:09AM 0 points [-]

If your current strategy for getting yourself to give is not working very well, you have a moral obligation to switch to my positive motivation strategy and forget about moral obligations :P

Comment author: J_Taylor 07 September 2013 02:01:33AM 0 points [-]

I sometimes have feelings of separation from my fellow man. Philanthropic activity tends to alleviate this. Likewise, it tends to buffer my emotions from feelings of personal inadequacy. Of course, these correlations are not sufficient to establish causation.

Also, I do get warm, fuzzy feelings. However, I do not hold these positive feelings to be as important as the suppression of negative feelings.

Comment author: Unnamed 05 September 2013 01:59:00AM 3 points [-]

Another concern about focusing too much on the happiness benefits of giving is that "giving" is a large category, and the forms of "giving" which have the largest benefit to the world are not necessarily the ones that produce the most happiness. (Eliezer has made a similar point.)

One of the published studies on this topic (Aknin et al., 2011) found that thinking about money spent on a close friend or family member produced more happiness than money spent on a more distant acquaintance, which suggests that the happiness boost may be strongest for relatively low-impact forms of giving which have more immediate/direct/local relevance to the donor. Another paper (Aknin et al., in press) focused on charitable giving and provides some evidence that people are happier when they perceive their donation as having a positive impact, but it's not clear that this happiness scales with the magnitude of the impact (and it seems likely to be influenced by things like the identifiability of the beneficiaries and the vividness of the benefit).

Aknin et al. 2011 ("It’s the recipient that counts") and Aknin et al. in press ("Making a difference matters") can both be downloaded on Elizabeth Dunn's webpage.

Comment author: private_messaging 04 September 2013 09:49:37PM *  5 points [-]

Even though you know that giving makes people happier, you do not know that telling this to people makes them happier. It may decrease that effect.

Furthermore, when money are involved, statements are generally considered as information with regards to the value of the cause, and by promising such rewards you may well make yourself look more dubious to a wide audience, which would depend very strongly on the specific wording - so an experiment may find the effect negative, when it could be positive with other wording, and vice versa.

Plus you will undermine the point of those who give in part because they need to demonstrate certain degree of selflessness in a way that would be suboptimal for selfish people to fake (honest signalling).

edit: specifically, at least some partially selfish agents seem to follow this overall principle (hypothetical figures for the illustrative purposes): 1000$ is 1 unit of utility when spent on myself or close family members, but 0.6 units of utility when spent on distant charitable causes, plus perhaps 0.6 units of utility from the improvements in cooperation enabled by this demonstration that the utility of lives of other people, while smaller than that of oneself and own family, are nonzero for you (gains in cooperation enabled by e.g. others knowing for sure that you won't take $1000 causing total of $10 000 in damage even when it is legal for you to do so). Note that a perfectly selfish party would not accept this deal. Of course one can't actually reason like this explicitly in the real life - if you do value other people's lives, you want that positive quality to be visible, as a part of general heuristic.

Comment author: Desrtopa 04 September 2013 11:09:03PM 0 points [-]

Even though you know that giving makes people happier, you do not know that telling this to people makes them happier. It may decrease that effect.

Indeed, this is probably my most major concern. For a person versed in cognitive biases, it might seem fairly plausible that our own intuitions about what makes us most happy would be flawed and that the research on the relationship between charitable giving and happiness would be worth taking seriously. But to the average person, suggesting that they engage in charitable giving because it will make them happier is an invitation to assess it as an option on relative to other ways they could spend their money on their own happiness, where charitable giving would probably lose.

Comment author: John_Maxwell_IV 09 September 2013 06:32:36AM 1 point [-]

If giving makes you happy, it also seems plausible that doing it in small amounts every day would make you happier than doing it in large amounts every year.

Comment author: RichardKennaway 05 September 2013 05:48:23PM *  1 point [-]

That it is better to give than to receive is an idea of some antiquity. Some people will be persuaded of it by saying "Jesus said", and others by "studies have shown".

So is the problem of burnout.

Comment author: peter_hurford 06 September 2013 12:45:57AM 0 points [-]

I don't understand what you mean. Could you elaborate?

Comment author: RichardKennaway 10 September 2013 03:18:11PM *  1 point [-]

Just pointing out that the idea that giving is good for the soul (i.e. "makes one happy" in materialist parlance) is an ancient idea, already much told to people. Of course, you can't talk about souls to materialists, but if you find that "science says it will make you happy" persuades them, why not?

Someone should do the experiments. ("And not only that, but science says that you'll give even more if we tell you it will make you happy!" There's got to be an SMBC in that.)

Experiment rules, but in advance of that I can think of ways it could go wrong, which might suggest further experiments. One is the burnout I mentioned. Another is this. If the actual mechanism of giving causing happiness is:

think a cause is worthy --> give to it --> satisfaction

then what happens in the situation:

indifferent to a cause --> give only because "science says" --> ??

Are you really buying happiness with money, or are you buying it by directing that money to something you already thought worth spending money on? There are issues of reflexive decision theory here.

Comment author: peter_hurford 10 September 2013 10:28:20PM 2 points [-]

Someone should do the experiments.

They have been done. Some of them are listed in the OP essay.

Comment author: Salemicus 05 September 2013 12:00:17AM 0 points [-]

Unfortunately, your question contains a number of implicit premises, which are difficult to untangle. I'd like to pick on just one: Should we be encouraging charitable giving? Having worked in the charitable sector myself, I'd answer in the negative. It's extremely wasteful of resources, has broken feedback processes, and mostly acts to benefit "insiders" within charities.

The wish to feel good about oneself (and showing off) is already a major reason why people give to charities, regardless of the publicly stated reasons. Of course we should tell people that giving to charity makes them happier - it's always a good thing to be truthful. Indeed we should emphasise at all times that most donors are likely giving in order to feel better about themselves, and seek status, not any genuine concern to do good. If this idea becomes thoroughly embedded in society, I am sure that the effect on charitable giving will be salutary.

Comment author: [deleted] 05 September 2013 10:18:43AM *  2 points [-]

Having worked in the charitable sector myself, I'd answer in the negative. It's extremely wasteful of resources, has broken feedback processes, and mostly acts to benefit "insiders" within charities.

Yes, Sturgeon's Law does apply to charities, but there are people out there who seek exceptions to that.

Comment author: peter_hurford 05 September 2013 02:51:29AM 1 point [-]

Should we be encouraging charitable giving? Having worked in the charitable sector myself, I'd answer in the negative. It's extremely wasteful of resources, has broken feedback processes, and mostly acts to benefit "insiders" within charities.

I don't work much in the charitable sector, but this flies against a lot of my experience in fundraising. Could you elaborate?

~

If this idea becomes thoroughly embedded in society, I am sure that the effect on charitable giving will be salutary.

Why?

Comment author: Salemicus 07 September 2013 05:47:45PM 0 points [-]

Could you elaborate?

Sure, but you'll understand if I am non-specific.

Wasteful of resources: For example, I used to be involved in a hospital charity, which among other things ran a shop in the hospital. This was a prime concession location, but the store was run at a loss. Nor was this because they charged lower prices; the store was horrible, and they were just incompetent in many ways, particularly stock management. A private company would have run that store as a better service to hospital patrons, while using fewer resources. This is typical of so much charitable operations: they get given special favours by government because of entrenched anti-market bias, and then squander them.

Broken feedback processes: Most donors don't give based on the good their money can do. Frankly most donors don't have the information to even begin to evaluate that. But nor, for the most part, do they seek it. And even the charity typically doesn't know. I used to work for a Christian environmental charity. I think we were doing a good job, but there were no real benchmarks, no way to really gauge. All we really did was measure inputs and activity. And that's all donors wanted to hear about too - as well as platitudes about our mission statement, etc. Pure feel-good nonsense. I now work in the private sector and it's night and day. I'm not going to pretend that the problems I'm working on are as important, but I'm damn sure we're solving them to the satisfaction of the people who want them solved.

Benefits insiders: For example, at that hospital charity, the treasurer wanted to overhaul the shop, for the benefit of hospital patrons and the charity's bottom line, but wasn't allowed to, because it would have upset the volunteers. At that environmental charity, the fundamental driving force was the whims and interests of the workers and volunteers, not a clear-headed weighing of pros and cons. And indeed, how could there be, given the broken feedback processes? So many charities (including MIRI) have been victims of theft, fraud and other abuse by insiders, in ways that would never happen in the private sector because the controls and processes are so different.

Does this mean that all charities are terrible and should be eliminated? No. Does this mean that all private companies are perfect? No. But, on that margin, I'd like to see more problems solved by market activity and fewer by charity.

Why?

Because if we have a cultural shift such that giving to charity is seen as a low-status act done only by show-offs rather than concerned individuals, we'll see less charitable giving, and those who do give will only be the genuinely concerned.

Comment author: peter_hurford 09 September 2013 02:55:46AM -1 points [-]

Obviously there are examples of ineffective organizations, but I don't think that makes fundraising a net bad. (Though, perhaps one could argue that overall funding could shift money away from more effective organizations, and that would be a net bad.)

~

Because if we have a cultural shift such that giving to charity is seen as a low-status act done only by show-offs rather than concerned individuals

Why do you think that would happen?

Comment author: Salemicus 11 September 2013 04:34:33PM 0 points [-]

I have written a lengthy and detailed comment in response to your questions, and you have not engaged with what I wrote, but just followed up with more general questions. As a result I am disinclined to continue this conversation.

Comment author: peter_hurford 11 September 2013 06:00:12PM -1 points [-]

I can understand why you would be disincentivized to continue and I appreciate what you've contributed so far. But I felt like a lot of what you wrote about was not relevant to what I was writing about.

You seemed to argue that ineffective organizations exist. I acknowledge that, but also argue that effective organizations exist. Do you deny that effective orgs exist or do you think it would be counterproductive to fundraise for effective organizations as well?

Comment author: Salemicus 13 September 2013 12:04:37AM 0 points [-]

You seemed to argue that ineffective organizations exist. I acknowledge that, but also argue that effective organizations exist. Do you deny that effective orgs exist or do you think it would be counterproductive to fundraise for effective organizations as well?

Why re-ask these questions when I've already answered them? To recapitulate...

"Does this mean that all charities are terrible and should be eliminated? No. Does this mean that all private companies are perfect? No. But, on that margin, I'd like to see more problems solved by market activity and fewer by charity." [emphasis added]

Comment author: peter_hurford 13 September 2013 08:22:01PM 0 points [-]

I understand that's what you're saying. But how do you draw from that the conclusion that you'd "answer in the negative" the question "[s]hould we be encouraging charitable giving?"

Comment author: shminux 04 September 2013 11:20:43PM -1 points [-]

Somewhat off-topic, but related to happiness from giving. Is volunteering (giving time) = giving? If the proverbial lawyer volunteering in a soup kitchen does not feel nearly as happy if she instead works extra hours and donates the proceeds, should one try to persuade her to do the latter, anyway, because it's more "effective"? Same with a doctor volunteering in Africa, a programmer answering questions on StackOverflow, etc.