A model of the value of giving to others compared to the value of having more for oneself: Implications for fundraisers seeking to maximize donor satisfaction
I begin with a brief review of some of the literature on the many benefits that charitable giving offers to donors. Next, a model is proposed that compares the value that donors obtain from giving to a worthy cause to the value of having more resources for themselves. The model is based on the prospect theory value function introduced by Kahneman and Tversky (1979) but includes a second value function for helping others. The chapter focuses on three characteristics of this model and supports them with a series of simple studies that examine the differences and similarities between the value that consumers derive from making contributions to charity and the value they derive from having more wealth. Based on each of the characteristics of the model described, recommendations are offered for fundraisers interested in maximizing the value donors obtain from giving.