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The Effectiveness of Charity Auction Mechanisms

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Nonprofit organizations depend on charitable donations to provide cash revenue. Charities frequently employ auctions and raffles to grow revenue and transform “in kind” donations into cash. Despite this, neither the theory nor the practice of efficient fundraising – and, in particular, charity auctions – has received sufficient attention from economists. In the previous stage of our research, we studied the revenue potential of fifteen different charity auction mechanisms in the experimental lab. While some mechanisms had already received attention from theorists and empiricists, we also explored the potential of new formats, such as the “bucket” and “hybrid” auctions. We are now testing the most lucrative mechanisms from the lab in the field at national non-profit conventions to identify the fundraising mechanisms that generate the most revenue for charitable organizations.

People

Max Benjamin
Michael DeLucia
Maria Perille
Researchers

Jeff Carpenter
Associate Professor of Economics

Jessica Holmes
Associate Professor of Economics

Peter Matthews
James B. Jermain Professor of Political Economy

Average Revenue (in $) of Auction Mechanisms
(click to view full chart)

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