Civil societies function because people pay taxes and make charitable contributions to provide public goods. One possible motive for charitable contributions, called "pure altruism," is satisfied by increases in the public good no matter the source or intent. Another possible motive, "warm glow," is only fulfilled by an individual's own voluntary donations. Consistent with pure altruism, we find that even mandatory, tax-like transfers to a charity elicit neural activity in areas linked to reward processing. Moreover, neural responses to the charity's financial gains predict voluntary giving. However, consistent with warm glow, neural activity further increases when people make transfers voluntarily. Both pure altruism and warm-glow motives appear to determine the hedonic consequences of financial transfers to the public good.
Figure: Neural response in the ventral striatum to mandatory payoffs for the subject (yellow), the charity (blue), and both (green). (To test for the pure altruism and warm-glow motives, they used functional magnetic resonance imaging while subjects played a dictator game. Subjects received $100 and then made decisions about whether or not to give money to a local food bank. They also observed mandatory, tax-like transfers of their money to the food bank.)
They suggest that:
...This result supports arguments for a common "neural currency" of reward and shows that this model can be applied not just to choice over money, risk, and private consumption goods, but also to more abstract policy choices involving taxation and charitable giving. Our results are also important for understanding why people give money to charitable organizations. First, these transfers are associated with neural activation similar to that which comes from receiving money for oneself. The fact that mandatory transfers to a charity elicit activity in reward-related areas suggests that even mandatory taxation can produce satisfaction for taxpayers. A better understanding of the conditions under which taxation elicits "neural rewards" could prove useful for evaluating the desirability of different tax policies.
Thursday, June 21, 2007
Brain responses revealing motives for charitable donations.
A recent study by Harbaught et al. finds that three very different things—monetary payoffs to oneself, observing a charity get money, and a warm-glow effect related to free choice—all activate similar neural substrates. Here is their abstract, PDF of article is here.