Feeling poor, acting stingy: the effect of money perceptions on charitable giving

Abstract

In philanthropic research, much attention has been given to the impact of the actual costs of giving. In this paper we argue that, in addition to actual costs, the perceived costs of giving should be taken into consideration when seeking to understand the incidence and scale of charitable giving. We know from the economic and sociological literature that people differ in their attitudes towards money (Furnham and Argyle 1998;Zelizer 1989) attitudes towards money are rarely considered as a key explanatory factor behind the propensity to give and decisions regarding size of gifts. This paper seeks to rectify that situation by focusing on hypotheses that explore the effects of money perceptions on charitable giving. The hypotheses are developed from qualitative data found in existing UK datasets in which the wealthy account for their decision to give or withhold donations. We find that, regardless of the actual financial resources held by the individual, the decision to give and the size of gift are negatively affected by feelings of retention (a careful approach to money) and inadequacy (people who worry about their financial situation). Feeling financial secure positively affects the act of making donations. We conclude that money perceptions are an additional significant variable in explaining incidence and level of charitable donations.Sir Tom Hunter, Scotland's first home-grown billionaire and the most prominent contemporary UK philanthropist, recently explained how he tries to enthuse his fellow superrich to follow his philanthropic lead. He tells them, "I'm having the time of my life and I want to

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