Shared Social Responsibility: A Field Experiment in Pay-What-You-Want Pricing and Charitable Giving

TLDR

A field experiment with 113,047 participants varied the price format (fixed price versus pay‑what‑you‑want) and whether half of the revenue was donated to charity. The study found that a charitable component only modestly increased demand at a fixed price, but when customers could choose their payment, the same charitable option made the treatment substantially more profitable, demonstrating that shared social responsibility lets consumers express welfare concerns through purchases.

Abstract

A field experiment (N = 113,047 participants) manipulated two factors in the sale of souvenir photos. First, some customers saw a traditional fixed price, whereas others could pay what they wanted (including $0). Second, approximately half of the customers saw a variation in which half of the revenue went to charity. At a standard fixed price, the charitable component only slightly increased demand, as similar studies have also found. However, when participants could pay what they wanted, the same charitable component created a treatment that was substantially more profitable. Switching from corporate social responsibility to what we term shared social responsibility works in part because customized contributions allow customers to directly express social welfare concerns through the purchasing of material goods.