Kiel Working Papers, Kiel Institute for World Economics
No 1680:
Donations to US Based NGOs in International Development Cooperation: How (Un-)Informed Are Private Donors?
Peter Nunnenkamp and Hannes Öhler
Abstract: Apart from scaling up foreign aid by NGOs, informed
choices of private donors could also encourage an efficient and targeted
use of NGO funds in international development cooperation. We assess the
determinants of private donations across a large sample of US based NGOs
with foreign aid activities. OLS and 2SLS estimations indicate that donors
hardly make use of publicly available information on NGO characteristics,
notably the “price of giving” and the degree of specialization, when
deciding on donations. They rather rely on the frequently offered option to
designate donations to preferred purposes – even though this behavior would
be rational only under conditions that are unlikely to hold
Keywords: non-governmental organizations; specialization; private donations; informed choices; price of giving; option to designate; (follow links to similar papers)
JEL-Codes: L31,; F35,; D80; (follow links to similar papers)
23 pages, February 2011
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