López-Pérez, R., & Ramírez-Almudio, A. (2020). Why people give to their governments: The role of outcome-oriented norms.


Raúl López-Pérez, F., and Aldo Ramírez-Almudio

Abstract: The social and economic factors leading to selfless acts such as charitable donations have been a central concern in the social sciences. We contribute to this scholarship with an artefactual field experiment in Peru where subjects anonymously decide how much of their endowment they freely donate to the Peruvian government. The standard rational choice model and several well-known models of non-selfish preferences predict zero giving. Yet we observe that around 75% of the subjects give something (N = 164), with substantial heterogeneity. Further, individual donations depend positively on the level of support to the government and beliefs about the average donation. Additional evidence on the role of beliefs comes from one treatment in which these beliefs are exogenously shaped, resulting in a change in the distribution of donations. Our results are consistent with a utility theory based on outcome-oriented social norms, which we develop in detail, and suggest that people are willing to contribute to their governments if they believe that enough others give as well and that the money is not wasted or ‘stolen’ by the government, but used to promote social welfare.

Keywords: Altruism, Donations, Norms, Public Goods, Social Information.