Understanding Philanthropy : A Review of 50 Years of Theories and Research

We present an overview of theories and research on charitable giving in economics, sociology, social psychology, and marketing from the past 50 years (1955-2005). We identify seven mechanisms as the most important forces that drive giving. The seven principles of philanthropy are: (1) solicitation; (2) awareness of need; (3) costs; (4) reputation; (5) psychological benefits; (6) changing the world; (7) confidence. We discuss each of these mechanisms and show how they are related to the findings of survey and experimental studies on philanthropy, and how practitioners can use them.