We Could Be Giving More Effectively

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The holiday season is typically a time for extra generosity, whether because of a cultural association with the holidays as a time of giving or because of the desire to make end-of-year donations for tax purposes.

However, according to a recent article in the Wall Street Journal, Americans have a variety of fallacies that prevent us from being as generous as we could be.

The WSJ conducted a survey of its followers on social media and found that there are three main mistakes people make when giving to charity.

Mistake 1: The martyrdom effect

Dr. Christopher Olivola says that one of the biggest mistakes people make is what he refers to as the Martyrdom Effect. That is, people prefer to give in a way that requires sacrifice or discomfort, such as bicycling across a state to raise funds or taking the ice-bucket challenge, rather than writing a check. In fact, donating money can be a great deal more effective because a charity can use a cash donation to greater effect than they can one person’s volunteer efforts.

Mistake 2: The other-nothing neglect

In another study, Dr. Olivola concludes that people tend to think of donating as a means of giving up our own happiness for the sake of others. In other words, people tend to think of what they have to lose by being generous but don’t think as easily about what others gain by their generosity. If we focus more on the benefits to others, we won’t as easily fall prey to this logical fallacy.

Mistake 3: The unexpected joy of giving

In this logical fallacy, people believe that giving money involves a sacrifice of happiness. But study after study has confirmed that people actually feel happier when they spend money on someone else than they do on spending it on themselves. Think about how you feel when you give gifts to a friend or family member: Typically it makes you happy to purchase a thoughtful gift that you’ve bought just for them. It’s the same thing with philanthropy: Donating to an organization that helps people or animals in need just feels good.

Given, the study the WSJ did doesn’t meet the standards of academic rigor like the ones Dr. Olivola has done, but the anecdotal evidence produced by the WSJ survey certainly backs up what’s been documented in scientific research.

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