Relational altruism and giving in social groups

•In peer-to-peer fundraising, social groups and personal relationships are important for fundraising outcomes.•We study the relationship between a fundraiser’s social group size and donations using a large sample of fundraising pages from a major peer-to-peer platform.•We find a positive relationship between social group size and number of contributions, but a negative relationship between social group size and the size of contributions.•We rule out classic free-riding since there is a negative relationship between social group size and contribution size among fundraisers raising money for the same charity.•Instead, the relationship is consistent with “relational altruism” where the donors care about the fundraisers and the fundraisers care about how much they raise.

Much fundraising is done by individuals within existing social groups. Exploiting a unique dataset, we demonstrate (i) a positive relationship between social group size and the number of donations; (ii) a negative relationship between group size and the size of individual donations; (iii) no clear relationship between group size and the total amount raised. Free riding with respect to the activity being funded cannot explain the relationship between group size and donation size, since the number of social group members is only a subset of total contributors. Instead, the findings are consistent with the notion that giving in social groups is motivated by “relational altruism”.