10,000-Way donation matching

Abstract

This article suggests a donation-matching mechanism which it argues might significantly increase the funding for public goods. The mechanism calls for randomly allocating prospective donors into two groups and soliciting responses from each group regarding the amounts of money they would pledge to donate across a range of matching targets. For a given group (the target group), the midpoint of the contributing range which corresponds to the highest estimated donation total for the other group would then be determined. In essence, the target group is attempting to accurately guess the level of matching target that would generate the most total revenue from the other group. The proposed mechanism would then select this target as its own, which would commit both groups to only contributing their pledged amounts if the target is reached. The article argues that this method could increase donation incentives by as much as 20-fold, while excessive funds go unmatched at a rate of approximately 15%. Although the article acknowledges uncertainties and potential complexities, it concludes that appropriate matching mechanisms and the one it proposes in particular could improve public goods funding. – AI-generated abstract.