This practice has grown in popularity, with companies such as Bomba’s, Tom’s and Warby Parker making charitable donations, in cash or in kind, on behalf of consumers. Giving by Proxy is even expanding outside of the retail context, with some companies beginning to use the promise of a charitable gift as an incentive for strong employee performance.
What is not known, however, is how this practice affects consumer behavior afterwards. Does an experience with proxy giving make people more or less likely to be charitable themselves? Any change could have a big impact on the net social impact of these initiatives.
When she started investigating this question, Maryam Kouchaki, professor of management and organizations at the Kellogg School, could see it going either way. Her previous research found that when people see themselves as moral, they give themselves permission to behave in self-serving and self-interested ways, a phenomenon called “moral licensing.” At the same time, he thought, providing through an agent could also serve to prime the pump for future benefit.
Fortunately, it’s the latter. Vicarious giving experiences make people more willing to be charitable in the future. Koutsakis, along with Kellogg doctoral student Samantha Kassirer and Jillian J. Jordan of Harvard Business School, were found that people are more favorable after a proxy giving experience—even when they have no control over the recipient of the original donation.
“Giving by proxy has an indirect impact, meaning people who participate in these efforts are more likely to donate later or do more good work,” Kouhaki says. “There is a spillover effect.”
Buy one, give one and future benefits
The researchers designed several experiments to investigate the relationship between proxy giving and subsequent charitable behavior. In the first of these, 756 participants completed an online experiment for which they received $1.50, plus (in some cases) a $0.50 bonus in the form of a charitable donation made on behalf of the participant.
Participants were randomly assigned to one of three groups: a group in which they chose the charity that would receive their bonus, a group in which the charity was chosen for them, and a control group.
They then completed ten simple word search games. For participants in the two proxy-giving groups, each completed word search earned a five-cent charity bonus. in the control group, no bonuses were given.
The researchers then asked the participants if they would like to be informed about future studies. Those who answered yes were asked whether they preferred studies where they could earn bonuses for charity or those where they could earn bonuses for themselves. This decision, between a charitable choice and a more selfish choice, was the main variable the researchers focused on in their analysis.
Both proxy groups were significantly more likely to make the charity choice than the control group, the results showed: 27 percent of the proxy and 29.8 percent of the autonomous participants expressed interest in research with a bonus for charity aims. compared to 17.4 percent of control group participants.
The negligible difference between the two proxy giving groups piqued Kouhakis’ interest. “Intuitively, you might think there would be an extra bump in charitable behavior if you have a choice,” he says. “There’s a lot of research on the importance of autonomy that suggests it should matter.” In all of their studies, choice didn’t matter.
Grant through agent and charitable credit
Then researchers began to understand Why Proxy provision prompts social behavior. They suspected that giving by proxy—whether they chose the recipient or not—could induce people to take charitable “credit” for that donation, motivating future prosocial behavior.
For this experiment, 685 young participants were once again divided into three groups: a proxy bidding group where they could choose the charity, one where they could not, and a control group. They then completed a word search where they earned $1, plus either a $0.25 charitable bonus (in the two proxy giving groups) or no bonus (in the control group). Participants once again made a choice between participating in future studies with a bonus for either themselves or charity.
Finally, participants answered a series of questions designed to assess why proxy bidding might induce a greater willingness to bid. Specifically, the researchers asked participants to rate how much moral or charitable “credit” others would give their behavior during the study.
As in the first experiment, participants in both proxy gift groups made the charitable choice at roughly equal rates—and at significantly higher rates than the control group. While there was no difference between the control group and the proxy giving groups in how much ethical credit they got, there was a difference philanthropist withdrawal of credits.
Notably, the two proxy groups felt equally able to take credit for their charitable actions. For Kouhaki, this explains why the choice (or not) of the bonus recipient ultimately did not affect participants’ willingness to make the charitable choice. “It doesn’t matter if you benefited from charity A that you preferred or charity B that others chose – others (including you) will see you as a charity,” he says.
Giving proxy to nature
For their latest experiment, the researchers tested the downstream effects of proxy provisioning in a real-world setting, using Amazon The AmazonSmile program was recently closed. Under this program, customers made purchases on a look-alike website, AmazonSmile.com, where the purchases benefited a charity of their choice.
The researchers recruited 603 young participants, gave them a $3.50 Amazon gift card, and asked them to choose one of six items to purchase. Half of the participants (the proxy giving group) were told they would make the purchase through AmazonSmile and were given a brief description of the program, while the rest were simply directed to Amazon.
Participants were then informed that they would be entered into a drawing to win $50. If they won the lottery, they could either keep the winnings or donate half to a charity of their choice. They also answered the same questions about charitable giving used in the previous study.
Once again, participants were significantly more likely to donate potential raffle winnings to charity in the AmazonSmile group (39.5 percent) than in the control group (29.2 percent). Taking credits from charitable causes was also higher in the AmazonSmile group, which, according to statistical analysis, drove the highest rates of philanthropic behavior.
Giving to scale
To Kouhakis, the research offers an optimistic lesson. Proxy giving programs not only have short-term positive effects, but also have the potential for wider impact. “Giving encourages future giving and creating that type of culture is important,” he says. “You have to be careful how you do it, obviously, but you can use these programs to build momentum.”
He hopes more companies will experiment with these programs. she is particularly intrigued by the growing practice of social security benefits. “Exists already investigating showing that these programs are effective in increasing employee motivation—it motivates them and creates more loyalty, as well as these indirect effects. These are really positive programs.”
