Learning to Give

There he is at your fancy gala; rich, successful, and bored out of his mind. He’s got an MBA from an Ivy League school, an undergrad in economics and a wife… who studied art history… and who drags him kicking and screaming to your events. He’s worth a mint, but the most you may ever get from him is the price of the gala’s tickets.

Is it even possible to get this Philistine to change his mind about your cause?

The answer has as much to do with how people learn and what kind of ideas they are exposed to as it does how much money they have to give.

(Read more about the learning side of this equation on my blog on informal learning called The Learner's Guild.)

A yet-to-be published study by Professor Raymond Fisman from Columbia Business School… along with Shachar Kariv of UC Berkeley and Daniel Markovitz of the Yale Law School… suggests that even mature students can change their minds when presented with powerful ideas.

In this study Fisman and his co-authors Shachar Kariv and Daniel Markovitz studied first year Yale law students to see to what degree their teachers affected their generosity in giving when they played an experimental economics exercise called a dictator game.

Regular readers will recognize Raymond Fisman’s name. Fisman and other colleagues found a positive relationship between profitability and corporate philanthropy for businesses that advertised a lot.

Here’s how this study worked. All first year law students at Yale University are required to take courses in contracts and torts. Some of the professors who teach the courses hold PhDs in economics, some in the humanities, and some have “no strong disciplinary allegiances at all.” The students are randomly assigned to the professors and the professors are allowed to design the course however they wish.

Fisman, Kariv and Markovitz theorized that students coming out of class taught by a philosophy teacher might be more concerned with social justice and equality, while students taught by an economics professor might place greater emphasis on economic efficiency.

They tested their theory by putting 70 of these Yale law students in a computer lab to play a dictator game with 50 decisions relating to giving.

“In some cases students started with $10,” writes Fisman in Forbes Magazine, “and for each dollar they gave up, their (anonymous) partner in the game would get, say, $5. In this case giving was ‘cheap.’ In others giving was expensive (each dollar given up yielded only 20 cents for the partner.”

By definition if you start with $10, give away $10 and still have $8 left as a giver, you’re concerned about efficiency. Likewise, if you give even when it’s expensive to do so, you are almost certainly concerned about equality. If you never give whether it’s easy or hard, you’re probably selfish.

So what were the results?

“It turns out that exposure to economics makes a big difference in how students
split up the pie,” says Fisman, “in terms of both efficiency and outright selfishness. Students assigned to classes taught by economists were more likely to give a lot when it was cheap to do so. But they were also more likely to take the whole pie for themselves.”

Likewise, students exposed to teachers from the humanities… no matter their previous academic backgrounds… were more “sympathetic to equality.”

So what’s a fundraiser to do? Ask to see donor’s college transcripts? Test donors on Fisman’s dictator game? Stay in bed for the next week or so?

Smart fundraisers know that donors are different, and that the pitch that worked for one would-be donor might not work for the next.

Smart fundraisers… like smart marketers… also know that you need to segment your audience. But even when you’re sure you’re addressing people who are concerned about social equality, only the fool or the incompetent doesn’t also mention something about the rational, hard-headed qualities of the cause; that it’s efficient, well-managed, has a good board, effectively accomplishes its mission, uses its resources smartly, etc.

Every message… including those used in cause-related marketing… should have head and heart.

Is it worth it trying to convert that rationalist Philistine? You bet. His mind can be changed. Fisman et al demonstrate that. And better, Fisman also demonstrates that when that rationalist gives, he's likely to be the most generous type of donor if you structure it right.