Research

My research statement can be found here. (pdf)

"Overhead Aversion: Do some types of overhead matter more than others?" (with Javier Portillo) (Journal of Behavioral and Experimental Economics Volume 72, February 2018, pp. 40-50)

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Overhead aversion is an issue of great importance to nonprofit organizations. On one hand, overhead is vital to the operational abilities of a nonprofit; on the other hand, there is suggestive evidence that donors dislike paying for overhead costs. In this paper, we use an experiment to study overhead from the perspective of donors. First, we establish the existence of overhead aversion following Gneezy et al. (2014). Then we examine more closely whether donors have an aversion to specific types of overhead.

"Cooperation, Contributor Types, and Control Questions" (with Luke Boosey, R. Mark Isaac, and Douglas Norton) (Journal of Behavioral and Experimental Economics Volume 85, April 2020, 101489)

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A large number of experimental studies use the strategy method procedure introduced by Fischbacher, Gächter, and Fehr (Econ. Lett. 71:397-404, 2001) to measure individuals’ attitudes towards cooperation. The procedure elicits subjects’ strategic-form decisions in a one-shot game and classifies each subject as one of several different contributor types. In this paper, we examine the robustness of the procedure and its capacity to help explain the pattern of contributions observed in a separate, repeated game setting. Overall, we show that the elicited contributor types can explain behavior fairly well in the repeated game. Free-rider types contribute less than conditional cooperators, although we observe evidence consistent with strategic cooperation in the early periods of the repeated game. Nevertheless, by the last period, classified free-rider types converge to pure free-riding behavior. In addition, we highlight a potential methodological concern related to the use of control questions. We find that the inclusion of control questions increases (decreases) the proportion of free rider (conditional cooperator) types, but also leads to substantial wait times for many subjects. This raises concerns about the psychological impact of long wait times, through boredom, frustration, or spite, on the cooperative behavior of subjects in the laboratory setting.

"Costly Information Acquisition in Charitable Donations: Experimental Evidence" (pdf here)

An obstacle that charities face when soliciting donations is overhead aversion – the phenomenon that donors dislike their donations going to pay for non-mission expenses such as fundraising and administration. Overhead aversion has been shown to occur in field and experimental settings, but the question of how strong it is remains relatively unexplored. Since information on overhead costs typically is costly to obtain, it is unknown how much overhead aversion affects charities in practice. This study addresses this by measuring whether people are willing to pay for information related to these overhead costs. In a laboratory experiment, subjects earn money and are subsequently matched with one of two charities with different levels of overhead spending. The treatments vary whether subjects can receive information about their matched charity (and therefore the percentage of their donation going toward overhead expenses) and whether that information is costly. The results have implications for charities, indicating whether people care about overhead expenses sufficiently to incur a cost.

"The Effects of Nonprofit Overhead Costs on Financial Success and Survival" (with Joseph Duff) (pdf here)

Overhead expenditures are an issue of great importance to nonprofit organizations. These expenditures are vital to the operational abilities of a nonprofit; on the other hand, there is evidence that donors dislike paying for overhead costs. In this paper we use financial data of U.S. nonprofits from the National Center for Charitable Statistics (NCCS) to study the impact of overhead on the growth and survival of nonprofit organizations. We develop a model of nonprofits involving overhead, showing how competition for donations leads to nonprofit organizations reducing the relative amount they spend on overhead expenses. Then we use financial data to test the competing hypotheses of how overhead expenditures can affect the success of nonprofit organizations. For measures of success we look at changes in contributions and assets and the survival rates of nonprofit organizations from 1989 to 2013. Using minimum wage to instrument for the ratio of overhead expenditures to total expenditures, our estimates indicate that higher overhead ratios have a positive impact on contributions and net assets. We also find that higher overhead ratios are associated with a higher likelihood of survival. Our findings suggest that higher overhead ratios improve firm performance, leading to more positive outcomes for nonprofits.

"The Effects of Presidential Elections on Political Nonprofit Organizations" (with Xiaoli Guo)

After the election of 2016, contributions to left-leaning nonprofits in the United States rose dramatically. Our research question extends this more broadly: what is the effect of elections on political nonprofits in the United States? We have financial data going back to 1989 to explore this topic. We examine whether wins by Republicans help left-leaning nonprofits and hurt contributions to right-leaning nonprofits, and whether the opposite is true for wins by Democrats. We believe that people view the government and advocacy by nonprofits as substitutes, creating this "crowd out" effect.