Those of us who study the economics of nonprofit organizations often talk about the motivating effect of a “warm glow.” That is a rather non-technical way (that can be made very technical using some math) to describe reasons why people might donate time or money to a philanthropic organization. The logic is that someone might want to donate money to an organization because the act of donating makes them feel good, leaving them with a “warm glow” after giving. Such an effect has important policy implications, as the effects of public policy when people give when a warm glow is present and when they give without one, out of what is called “pure altruism,” are qualitatively different, leading to different outcomes from such things as tax changes. I found myself thinking of this recently as I watched an “Instigram” video posted by my ten year old niece in which she had her(elated) little brother dump a bucket of ice water over her head.
It is my understanding that many people on Facebook and other social media cites (none of which I participate in directly), are spending time this summer challenging each other to take the “cold water challenge.”This challenge asks a person to have cold water poured over their head in the name of charity. If the person does it, they give a certain amount of money to a charity. We economists would say that the warm glow from giving offsets the shock of ice water being poured over one’s head. In addition, I suspect, many people like to have their fifteen minutes of fame as they respond to a request by friends who obviously know them well enough to nominate them. However, if a person chooses not to take the challenge, they give an even larger amount to that charity.
It seems that this is a popular summer trend among not only my niece but also many other ordinary people as well as celebrities. One person compared it to a challenge to raise money by going “polar bear swimming” in frozen water in winter. Some organizations have risen quite a bit of money from this new trend, although I did find one person who asked why people don’t just give money directly to a charity. That is an issue that we economists wrestle with constantly. Being part of a trend and gaining a moment in the spotlight must be enough to make the marginal person give when they otherwise would not, cold water or not.
Have any of my readers or their children taken part in the cold water challenge this summer? If you have, who have you nominated in return? Did you feel that the donation was well worth it, and, out of curiosity, why did it take a cold water challenge to make you donate? Inquiring economists want to know.
So far, my daughter has resisted the temptation to issue or respond to a challenge, but if she does want to do it, I am sure that she can find other kids in the neighborhood who will be happy to assist her. I am just afraid that she will nominate me in return. Brrrr.
With the rest of this planet (and, I am sure, with those from the planet Ork), I mourn the death of Robin Williams. In the dark days of my Ph.D. studies, when I wondered if the benefit of continuing my program outweighed the cost, I saw the movie “The Dead Poets Society” and remembered that, more than anything, I wanted to teach. If only he knew the good that he brought into the world.