Heuristics and biases in charity

Abstract

Cognitive biases affect charitable giving, leading to heuristics like diversification, average vs. marginal benefit, prominence, identifiability, and voluntary vs. tax. Diversification should be avoided in favor of donating to the most effective charity. Scope insensitivity leads to equal donations regardless of the scale of the problem. Prominence bias focuses on a single attribute, leading to inefficient choices. Parochialism favors helping one’s own group, potentially reducing overall altruism. Identifiability evokes more empathy and donations to specific individuals, but this can also reduce donations to statistical victims. Finally, voluntary vs. tax bias favors private charity over government aid, despite the potential for greater efficiency through political action. – AI-generated abstract.