Wealth and charitable giving – Evidence from an Ethiopian lottery

Abstract

Does wealth make people more selfish or more generous? While this question has been at the center stage of the research on charitable giving, causal evidence is lacking. We offer winners and losers of a large Ethiopian housing lottery the opportunity to give to charities. Winners experience a very large increase in wealth, yet they are not more likely to donate money. They give slightly higher amounts to charities in absolute monetary value but nothing more in proportion to their income. We conclude that in this context charitable giving at the extensive margin is insensitive to exogenous wealth changes and that wealthier people do not become more selfish.