In episode 14, Rhod and Adam take a look at the field of behavioral economics and how it affects philanthropy. Topics covered include:

  • Classical Economics and charity: classical economics assumes we are all rational and self-interested, so it cannot explain behavior that is apparently irrational and purely altruistic. Hence new explanatory mechanisms have arisen- in particular, the “warm glow” theory which posits that all altruism is in fact “impure” because donors actually get a benefit from their giving. Subsequent neurological experiments have also backed this idea up. So what does this mean for efforts to encourage philanthropy?

Source: Giving Thought