Last night, as part of its philanthropy series, American Public Media’s “Marketplace” aired a story that examined how people think about giving. Host Kai Ryssdal interviewed Yale economist Dean Karlan on what motivates us to give. Dean provided an optimistic take on the recession and how it motivates donors to focus on the analytical side of supporting effective charities. He gave the example that in a tough economy people seem to adopt the mentality that “since I don’t have enough room here to make mistakes, what are the two charities, what is the one charity, that really has the evidence behind it for being effective, and let me go support that.”
We encourage you to listen to this insightful broadcast and let us know if you are taking more time to understand and analyze how effective a nonprofit is before making a contribution. Or if you are a nonprofit, are you taking the time to provide donors with proof of your organization’s effectiveness? This demonstrates to potential supporters that you are focused on results and that you are willing be transparent in sharing them.