Wednesday, February 05, 2014

Donor Behaviour and Charitable Budgeting - Resource Center - AFP

Donor Behaviour and Charitable Budgeting - Resource Center - AFP: y drawing up existing research in consumer psychology, we identified that this perceived difference was perhaps rooted in the theoretical idea of “mental budgeting,” which suggests that individuals create mental categories of “accounts” or “budgets,” and then allocate the expenditures they wish to make to those different budgets. In theory, once a budget is exhausted, expenditures that belong in that account should stop, since they are supposed to be fixed—otherwise, what is the point of having a budget? But other researchers (Dilip Soman and Amar Cheema) have found that if someone REALLY wants to make an expenditure, they will find creative ways to reallocate that expenditure to a mental budget that isn’t full, and quite easily justify these mental accounting “tricks” to themselves.

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