Trying to answer that question, Tel Aviv University economics professor Anat Bracha and her colleagues invited people to bike for 10 minutes in the gym at MIT. One group biked in public—in the gym's main room—while another group biked in a private room on the third floor. All the bikers earned money for a charitable cause based on the effort they exerted, but the researchers found that "giving was affected by how visible the participation was," says Bracha. "The more public, the greater the image boost, and the greater the contribution." In other words, the recognition we get from others is part of what motivates us to give.
Would things change, the researchers wondered, if they started paying the bikers for their participation? Turns out things did change—but only on the private third floor.
It seems the public bikers worried that the "image boost" they got from exerting themselves would be undermined if observers knew they were gaining personally from trying so hard, and the level of their effort was the same whether they received money or not. "Money and image motivations clashed," says Bracha. Those biking in private, on the other hand, didn't have the same conflict: Without any social judgment to deal with, they biked more miles on average when they were getting paid.
In this economy, Bracha argues, charitable organizations could benefit from really boosting the image of its donors—publicizing their names or recognizing them in some other way. "Charitable giving is a much greater sacrifice now than it was at this time last year," she says. "Budgets are tighter for everyone, so giving is likely to have greater image value."