TESTING FOR ALTRUISM AND SOCIAL PRESSURE > Fong and Luttmer 2009).Finally,it adds to the literature on social pressure (Asch 1951;Milgram 1963;Garicano,Palacios-Huerta. and Prendergast 2005;Gerber,Green,and Larimer 2008;Mas and Moretti 2009). The rest of the article proceeds as follows.In Section II with altru rre Weintroduce the experimentaldS e m discuss the reduced-form results in Section IV.In Section V,we structurally estimate the parameters.In Section VI,we discuss alternative interpretations.Section VII concludes. II.MODE We model the behavior of an individual whose home is visited by a fund-raiser.We distinguish between the standard case of an unanticipated visit and that of an anticipated visit.in the latter case,a flye r announces the visit and the individual can alter the probability of being at h e and opening th d uS: here the setting and predictions.The technical details,including Lemmas are in the Appendix,and the proofs are in the Online Appendix. IⅡ.A.Setup We consider a two-stage game betw n a potential giver and a solicitor.For convenience,we denote the potential giver,or solicitee,simply as giver.In the first stage,the giver may receive a flyer of the upcoming visit and,if so,notices the flyer with probability r (0,1].In the second stage,the solicitor visits the home.The p s the door obability h.If she did not notice yer (o rece ve on h is equal to a basel probability ho e(0,1).If she noticed the flyer,she can adjust the probability to h E[0,1]at a cost c(h),with c(ho)=0,c'(ho)=0,and c"()>0.That is,the marginal cost of small adjustments is small, but larger adjustments have an increasingly large cost.We do not metry around ho and we allow for ner solutions at If the giver is present,she donates an amount g>0.If she is absent,there is no in-person donation (g =0).The giver can donate through other channels,such as via mail or online,after learning about the charity from the solicitor or the flver.The giver has utility (1) U(g,gm)=u (W-g-gm)+av(g+0gm,G-i)-s(g) TESTING FOR ALTRUISM AND SOCIAL PRESSURE 7 FongandLuttmer2009). Finally, it adds totheliteratureonsocial pressure (Asch 1951; Milgram 1963; Garicano, Palacios-Huerta, andPrendergast 2005; Gerber, Green, andLarimer2008; Mas and Moretti 2009). The rest of the article proceeds as follows. In Section II we present a simple model of giving with altruism and social pressure. Weintroducetheexperimental designinSection III and discuss the reduced-form results in Section IV. In Section V, we structurally estimate the parameters. In Section VI, we discuss alternative interpretations. Section VII concludes. II. MODEL Wemodel the behavior of an individual whose home is visited by a fund-raiser. We distinguish between the standard case of an unanticipated visit and that of an anticipated visit. In the latter case, a flyer announces the visit and the individual can alter the probability of being at home and opening the door. We discuss here the setting and predictions. The technical details, including Lemmas are in the Appendix, and the proofs are in the Online Appendix. II.A. Setup We consider a two-stage game between a potential giver and a solicitor. For convenience, we denote the potential giver, or solicitee, simply as giver. In the first stage, the giver may receive a flyer of the upcoming visit and, if so, notices the flyer with probability r ∈ (0, 1]. In the second stage, the solicitor visits the home. The giver opens the door with probability h. If she did not notice the flyer (or did not receive one), h is equal to a baseline probability h0 ∈ (0, 1). If she noticed the flyer, she can adjust the probability toh ∈ [0, 1] at a cost c (h), with c(h0)= 0, c0 (h0)= 0, and c00(∙) > 0. That is, the marginal cost of small adjustments is small, but larger adjustments have an increasingly large cost. We donot require symmetry around h0 and we allow for corner solutions at h = 0 or h = 1. If the giver is present, she donates an amount g ≥ 0. If she is absent, there is no in-person donation (g = 0). The giver can donate through other channels, such as via mail or online, after learning about the charity from the solicitor or the flyer. The giver has utility (1) U (g, gm) = u (W − g − gm) + av (g + θgm, G−i) − s (g). by guest on September 20, 2012 http://qje.oxfordjournals.org/ Downloaded from