Defining returns functions and funding gaps

Abstract

As organisations receive more funding, the value of extra funding changes. This is relevant for donation decisions. People have used various concepts to discuss this feature: Room for more funding, Funding gaps, Diminishing (marginal) returns. I want to dig into what people mean when they use these terms. I ground these terms by distinguishing between two families of models: returns functions and funding gaps. It is usually best to be explicit about which model you are using.