Acting on a Charitable Conscience: how Behavioral Economics can be Applied to the Nonprofit Realm
Advisor: Dr. Allison James
Internship Location: Brooklyn College Foundation
Onsite Mentor: Emily Moqtaderi
Charitable giving has become an increasingly popular way of making a difference, given the volume of social, political, and environmental issues to tackle in the modern age. Because of this importance, understanding why people give and what can be done to help people follow-through on their intentions to donate becomes more and more important. My project focuses on three specific branches of what motivates individual donors to give to charities: social, financial, and external benefits. The goal of my project is to present a comprehensive overview of potential strategies and currently implemented tactics nonprofits can employ using these motivators through a behavioral economics lens. The project will take place at the Brooklyn College Foundation, where I’ll work with gift officers who actively work in fundraising to get a more comprehensive understanding of what strategies are currently in place. I’ll also conduct interviews with many other distinct organizations that receive donations to gather more information. Since my final product will be a research paper, the main body of my research process will be a literature review. The final analysis will be split up into two sections: one for the three motivating factors I’ve identified, and the other for strategies that have potential for application. Two conclusions I expect my research to draw are that behavioral economic nudges will be effective tools to motivate donors into following through on their impulses, and that no one primary factor will emerge as a predominant motivator above the rest.
Project Blog
Week 0: Introduction
Hello everyone. I'm Diego Griffin, a senior at BASIS Independent Brooklyn, welcome to my blog. My senior project is about making a connection between two fields I'm interested in: behavioral economics and charitable giving.
To be more specific, my research question is as follows: how can nonprofits use behavioral economic principles to leverage the social, emotional, and financial factors that motivate individual American donors to give to charity and increase donations? In other words, I'd like to provide an overview of the social, emotional, and financial factors that motivate people to give, and analyze the current strategies being employed to act on these motivators, potentially offering further tactics from behavioral economics, the study of choice, that could have some applications. My methods of research will come in two phases: a literature review on current knowledge, and a series of interviews with organizations for more specific information and an evaluation of my findings. My onsite placement will be at the Brooklyn College Foundation, and it'll help me gain a greater understanding of what approaches the organization takes to attract donors and how resources are allocated to do the most good.
Giving to charity has become an increasingly popular way of making a difference, and individual donations make up a large percentage of the charitable giving in our country. As the number of issues to tackle also grows, understanding how to garner the most support and help people follow through on their good intentions becomes critical. This is what makes my research valuable, the more information on what motivates people to give and how to act on those motivations, the greater a difference can be made. Some of my personal goals going into this project are to understand more of the connections behavioral economics has to other fields, how to effectively motivate people, and to win a prize for having the most serial-killer like senior photo on the blog page.
You can access my full senior project proposal here.
Week 1
Hello everyone, welcome back to my blog.
The main highlight of this week was starting at my onsite placement: the Brooklyn College Foundation. The work I’m doing here provides insight into the process of fundraising, and many of the motivating factors identified in my preliminary research have been reflected in the employed appeals. One of the most prevalent examples is that of social motivators. As I examined various examples of physical outreach the Foundation sends out to potential donors, I noticed that the notions of a collective effort and joining the community were present in nearly all of the pamphlets and envelopes. Much of the language in the captions present on each was geared towards this idea of community, tying back into the concepts of social visibility and the mentality of “buying-in” that motivate people to give. Since much of the target base of donors for the foundation are alumni, this focus on community and social motivation make sense. Many nudges I’d previously explored also came up, implemented in extensive highlighting of the ways donations have been allocated, potential positive impacts a donation could have, and specific testimony from recipients and people who have been positively impacted by the college as a whole. In addition to the physical outreach, I was able to learn about other influential factors in the Foundation’s outreach, including their fundraising calendar and segmentation of the donor-base. This provided examples of currently employed strategies and other external elements to take into consideration, including effective timing for solicitation and the likelihood of different age ranges to donate.
Aside from work at my onsite placement, my independent research has continued. So far, the majority of work done has been in gathering sources for review, though I’ve started on notes for some of them. Worryingly, my compiled research document is already fifteen pages long. A rough estimate tells me that at the end of this project that document should be around eighty-three pages. The research I’ve done so far has been mostly into the motivating factors, as per the first phase of my research outline, though I plan to pivot into behavioral economic concepts relatively soon. My guess is that by the next blog post, my compiled research will be around twenty-six pages in length, but we’ll confirm the accuracy of that prediction later on.
See you all next week.
Week 2
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Since starting work at my onsite placement, I’ve gotten the chance to have a more in depth look into the way the fundraising process is organized. One thing that especially struck me this week was how the concept was broken down. By nature fundraising is an umbrella term, so who works on what aspect can be divided based on donation size, donation type, and which donors are being targeted, among other factors. Another interesting finding ties back into the language from the physical solicitation I identified last week. As I got to analyze a wider array of solicitation types going out to a broader range of potential and previous donors, the degrees of similarity and difference between the language used piqued my interest. There is an obvious need for consistency in an organization’s word choice when it comes to outreach, but a balance needs to be struck between the desire for consistency and effectiveness of a more personalized message. The amount of people being solicited at once also factors into this choice, with a more consistent and less personal message being favored the broader the target audience.
As I continue to work at my onsite placement, I’ve also made substantial progress on the main body of my senior project: the research paper. After going through the sources I had gathered, I’ve compiled a first draft of the literature review section of the paper. Since this section will most likely be the largest part of the paper, I’m glad to have made more progress on it. Some of my next steps include incorporating more of my own analysis into the research I have so far, and generally planning out how I want to structure the information and paper as a whole. I also ran into the first major problem with my project, which has led me to slightly modify my research question. I found that having financial motivators as one of my motivation categories was too limiting of a definition, and couldn’t encompass all of the concepts I had aimed to cover with this motivating group. An example of this comes in some of the individual motivators I’ve identified: while tax benefits fit cleanly into the category of financial motivation and are a very important factor into why people donate, something like access to exclusive dinners and events as a result of giving to a cause doesn’t work as well, while still in a similar vein to what I had hoped to summarize in this motivating group. As a result, I’ve decided to extend the category into the broader idea of extrinsic motivators for giving, to give myself a broader net for categorization of factors that I found relevant, but didn’t fit anywhere else.
See you all next week.
Week 3
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At my onsite placement, I’ve gotten to speak with more gift officers and was able to dive into the concept of planned giving. This is the type of giving where people will write charitable organizations into their wills, and is a very interesting niche in the world of fundraising. Something that I took away from my conversations discussing planned giving was how personal the approach made had to be to attract a potential planned giver. Especially in economic literature, charitable giving can often be made out to seem like nothing more than a transaction in which a donor gives something and gets something back, but in reality, this isn’t the case. Planned giving in particular spotlights the human element of charitable contributions, which is something I hope my research can continue to reflect. As I uncover and explain more and more motivations to give, this human element becomes increasingly prevalent, and its importance to charitable giving is something I hope my project will continue to convey.
This week was mostly focused on editing my research paper. Since I had most of the base information I wanted to get across consolidated, my next steps were reorganizing the concepts in a more understandable manner, providing more definitions and explanations of topics to help the paper’s general clarity, and spending more time with individual points to better the paper’s pacing. I also added introductory paragraphs to the individual concept sections of the paper to further streamline its reorganization when I eventually have the other sections complete. This leaves the paper’s introduction and conclusion as the next two major sections to be done. Additionally, I’d also like to continue fleshing out the behavioral economics connections sections of the paper, with a more in depth explanation of solicitation and its effectiveness.
See you all next week.
Week 4
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This week at my onsite placement I continued to speak with more gift officers on the various roadblocks associated with encouraging donations, and was able to see more of the topics I’ve been writing about be actively reflected. One such topic was the idea of an organization’s projected values potentially affirming or dissuading a donor from donating: if a donor shares the values an organization puts forward they will be more likely to provide a charitable contribution, but if that organization’s values conflict with the donor’s own ideals, the opposite is true. These dual points lead to the inevitability that some number of potential donors will always feel opposed to an organization’s values and not donate, and this manifests itself with different donor age groups at the foundation. One of the main struggles being faced in the effort to attract more donors is the difference between the values of younger and older generations of donors, and since the organization in this case is a college associated with the state, a number of differences come up. These include the balance between the college’s past identity and its growth and evolution changing it from the organization it used to be, and differences in whether or not people want to support an organization affiliated with the state. These constraints make it especially important to find the right balance between the values an organization projects. Some of the values the organization currently projects are of academic integrity, educational and personal growth, and general community ideals. These are more general concepts that are in line with the goal of reaching a broader base of donors.
Alongside work at the foundation, I’ve also, as ever, continued work on the research paper. This week I focused on further improving readability by adding subtitles and splitting up my longer paragraphs. I also began to write the paper’s introduction, and am in the process of finding more statistics to further build it out. I’ve also continued making progress on the strategies section of the paper, and my next steps for it include further breaking it up into subsections to improve readability, and incorporate an introduction and overview of some important concepts relevant to the section. Once that’s done I’ll start work on the paper’s conclusion, and with that the first draft will be complete.
For those who are interested, an article on the employment of specific values can be found here: https://doi-org.brooklyn.ezproxy.cuny.edu/10.1353/sof.0.0191
See you all next week.
Week 5
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I helped send out a large wave of direct mailings at my onsite placement this week. This happened to coincide with research I was doing into the effects of solicitation, and something I found interesting was the potential negative effects of overusing solicitation. While it’s one of the most effective tools for encouraging donations, things like “donor-fatigue” and irritation can result from too much of it. Additionally, an onslaught of solicitation can actually cut down on its total revenue. To learn more about these topics, I recommend a paper linked here, and you can also find a lot more specific information in its references. Because of this, tools that mitigate these risks like the considered fundraising calendar employed by the Brooklyn College Foundation are important for organizations to implement.
In terms of the research paper, this week has mostly been an extension of the work I did last week. I began work on the introduction of the research paper, and continued to build out the strategies section. My next steps are to make progress on the conclusion paragraphs for each of the individual sections, and the whole paper’s final conclusion. I’ve been avoiding doing these since conclusions are usually the part of a paper I struggle with the most, so to try and mitigate some of the difficulty, I’ve tried to frame some of the goals I hope the conclusions will achieve. My hope is that this will help streamline the writing process, and make compressing the summaries a little easier. Aside from the conclusions, I’m now in the tuning phases for the other sections, with a focus on reorganizing sections and rephrasing parts to make my points and transitions more clear.
See you all next week.
Week 6
Hello everyone, welcome back to my blog.
At my onsite this week, work was mainly focused on sending thank you letters as a follow up to the wave of mailers that went out the week prior. There isn’t much to talk about here, but it is worth noting that thank you letters are a key component of the fundraising effort. Thank you letters provide not only additional recognition for donation, but can help reinforce the impact a donation will make, the donor’s altruistic identity, and their commitment to future donations, all of which promote further donation.
As for the research paper, this week marks some of the final steps of editing. I again mostly spent my time tuning sections by changing phrasing and incorporating more support for some of my points, and have almost fully completed the motivations section of the literature review, which is a large part of the paper’s body. Additionally, I’ve made further progress on the connecting introductions and conclusions for each section, though work still remains to be done until I can call them finished. At the current pace I’m going, I’ll have completed a full first draft of the paper by next week.
See you all next week.
Week 7
Hello everyone, welcome back to my blog.
This was my second to last week working with the Brooklyn College Foundation. Most of my work was focused on digitizing checks that came in from the wave of physical mailings, and I was also tasked with helping the effort to clear out outdated files and make room for more relevant information. As I’m nearing the end of my working with the Foundation, I wanted to take stock of some of my main takeaways from the experience. One thing that especially stuck out to me was how much of a holistic and segmented approach the foundation takes towards fundraising. Because of how much the process was broken down, I was able to learn from not only a general and top down perspective, but also see the consideration put into more niche and specific aspects. An example of this is learning about the specialized approaches taken in planned giving, which I discussed a couple weeks ago. Seeing how these approaches differed and interacted in different contexts has been especially relevant to my project, and I hope to continue looking into this as I reach out to other organizations.
This week also marks the completion of the first full draft of my research paper. Though there are still spots I recognize will require further tuning, my next steps are now to finally submit it for feedback. Additionally, though I have all of the sources I’ve been using for the literature review, I haven’t yet formatted them into a proper works cited section, leaving further work to be done on that front.
See you all next week.
Week 8
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This marked my final week working with the Brooklyn College Foundation. Through this internship I’ve gotten the opportunity to learn a lot about fundraising and narrow down a specific direction for my project. For the rest of the weeks, I plan on reaching out to various other organizations to discuss their fundraising strategies and generally talk about my research. For this part of the project I plan on casting a wide net to organizations that are very different from one another, with the goal of broadening the pool of applications my research can have.
Upon completion of my first draft, I spent this week organizing my references into a proper works cited section of the research paper. While actually writing the paper, I had set all of the articles and papers to be cited aside with the intention of properly formatting them further down the line, which proved to be a much more complicated task than I had previously thought. Aside from compiling sources, I’ve also begun work on my project’s final presentation. My goal is to have it completed sometime within the next two weeks.
See you all next week.
Week 9
Hello everyone, welcome back to my blog.
This week I began reaching out to organizations to talk about my research. Because of the somewhat tight deadline for time, there is a distinct possibility that organizations don’t get back to me on time or that I won’t be able to find time to meet. In an effort to avert this potential risk, I’ve tried to reach out to as many organizations as possible with the hope that at least some of them will get back to me in time.
After completing the references section of the paper, I’ve moved on to another round of holistic editing. Right now my focus is again the introduction and conclusion sections of the paper as I’m still not 100% satisfied with their state. The most major changes I want to make to these sections are reorganizations to adjust their tone and generally cutting down on length to improve readability.
See you all next week.
Week 10
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I’ve spent most of this week working on my project’s final presentation. Because of time constraints, I’ve decided not to pursue interviews with local nonprofits. Though I had wanted to use interviews as a means of testing the effectiveness and applications of the strategies I’ve identified, because of the time constraints I’m satisfied to leave determining the applications of the identified strategies as an avenue for further research.
At the suggestion of a member of the Brooklyn College Foundation staff, I have recently picked up Herman Melville’s The Confidence Man. I’m about a quarter of the way through the book, but some of the ideas being communicated so far are that charitable giving is based on a system of confidence between two individuals, a general distaste for a culture that discourages asking for and receiving aid, and the way that suspicion can so easily seep into a collective conscience and poison one’s decision making. These ideas build off of one another to define the current system of charitable giving as somewhat fragile, since an organization based on trust can’t survive in a setting so geared towards the breeding of suspicion. While certainly relevant to the time in which Melville was writing, as I learn more about what factors drive individuals to make charitable contributions, I can’t help but feel that the impact of suspicion is marginally less applicable in the modern day. As the charitable giving scene moves towards giving towards organizations as opposed to individuals, the equation for building trust shifts to one of organizational confidence. In the world The Confidence Man describes, philanthropists give for giving’s sake. After learning what I have from my senior project, I’ve found that in reality, the picture isn’t so clear cut.
See you all next week.
Week 11: Reflection
Hello everyone, welcome to the final entry of my blog.
With the research paper complete and slides presented, my time with the senior project is coming to a close. There are a number of things I’ve gotten out of this process: the chance to take a closer look into the world of charitable giving and discover complexity and aspects I hadn’t previously considered, an opportunity to take stock of and compare the multiple lenses through which the same topic can be investigated, and a general introduction into doing long form research and managing my time. In retrospect, the thing that really made this project worth undertaking was the window it gave me to see the good people are doing in the world. Especially in recent times, it can be especially easy to focus on all of the negativity in the world, but through my onsite placement and study of various organizations I was continuously inspired and uplifted seeing the work people put in to try and remedy some of the world’s issues.
For those who want to learn more about my project, I’ve linked my final presentation here and my full research paper here. I highly recommend reading some of the work I’ve cited if any part of the research is of interest to you.
Thank you all.