Warm-glow giving

Economic theory / From Wikipedia, the free encyclopedia

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Warm-glow giving is an economic theory describing the emotional reward of giving to others. According to the original warm-glow model developed by James Andreoni (1989, 1990),[1][2] people experience a sense of joy and satisfaction for "doing their part" to help others. This satisfaction - or "warm glow" - represents the selfish pleasure derived from "doing good", regardless of the actual impact of one's generosity. Within the warm-glow framework, people may be "impurely altruistic", meaning they simultaneously maintain both altruistic and egoistic (selfish) motivations for giving. This may be partially due to the fact that "warm glow" sometimes gives people credit for the contributions they make, such as a plaque with their name or a system where they can make donations publicly so other people know the “good” they are doing for the community.

Whereas "pure altruists" (sometimes referred to as "perfect altruists")[3] are motivated solely by the desire to provide for a recipient, impure altruists are also motivated by the joy of giving (warm glow).[2] Importantly, warm glow is distinctly non-pecuniary,[4][5] meaning it arises independent of the possibility of financial reward. Therefore, the warm glow phenomenon is distinct from reciprocal altruism, which may imply a direct financial incentive.[6]

Warm-glow giving is a useful economic framework to consider public good provision, collective action problems, charitable giving, and gifting behavior. The existence of a warm glow helps explain the absence of complete crowding-out of private giving by public grants, as predicted by classical economic models under the neutrality hypothesis.[7][8] Beyond economics, warm glow has been applied to sociology,[9][10] political science,[11] environmental policy,[12][13] healthcare,[14] and business.[15] Conceptually, warm-glow giving is related to the notion of a "helper's high"[16] and appears to be resilient across cultures.[17][18]