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Faculty Viewpoints

What Does It Mean to Be Generous?

Do we act generously because we want to help other people, or for attention and approval? Are we motivated to give in the ways that will do the most good? Deborah Small, Adrian C. Israel Professor of Marketing, explores how we make choices that affect our own and others’ welfare and what leaders need to understand about behavioral marketing to expand social impact.

Q: Are there key questions that have guided your career?

All my research looks at judgment and decision making. I’ve done work on couples’ financial behavior. I’ve looked at how emotion influences our perception of risk. I’m quite interested in our moral intuitions and how they align with our actual behavior. Right now, I’m doing research on how people evaluate moral transgressions.

But, over the course of my career, the key question I keep coming back to is, “What does it mean to be generous?”

Q: How do you approach that question?

When you think about what it means to be generous, you can think in terms of the impact—the more lives saved by an action the more generous it is. Or you can consider the intent. Is someone acting for the right reason, or do they have some ulterior motive?

For centuries philosophers have been debating whether altruism even exists. Can we simply do something nice for another person or can any ostensibly generous act be explained as ultimately driven by self-interest?

You could argue that the most generous person is the one who is willing to look like a braggart in order to have more impact.

Imagine a very generous action—a person donates a kidney. We can still ask whether their motives were pure. Maybe they gain so much status and respect from society that it’s worth it to them. Maybe it feels so good to make the donation, just purely from an emotional level, that they’re being selfish because they’re trying to feel better about themselves.

Trying to figure out whether there’s pure altruism leads to fantastic thought experiments, but I’m not sure it will ever be possible to say definitively. So I don’t actually try to answer that question. I skirt around it and instead ask questions about human judgment and behavior differs from rational models.

Q: Would you give an example?

When people do something generous like donating to a charity, do they think, “How will my giving benefit the most people?” That would be the optimal, “rational” way. But, for most of us, that’s not what we do.

Research, including work I’ve done, shows that if you have somebody in your family who died of a certain disease, then you become more sympathetic towards others with the same disease. You’re not helping your deceased loved one by giving money to strangers who you’re never going to meet, yet you’re more willing to help them, just because of the alignment between their situation and something in your own personal experience. Whether that giving benefits the most people doesn’t even factor in. It’s our personal experience that shapes where we give.

I believe it’s valuable to understand how our patterns of behavior systematically differ from effectiveness maximization and why.

Deborah Small

Another line of my work explores, what do people think is generous? In other words, when they see a generous act, do they give the person credit? Or do they discount it by saying, “There’s some ulterior motive”?

We do the same thing with brands. It’s in vogue right now for brands to engage in all sorts of reputation-enhancing activity. There are all sorts of interesting questions about whether customers give them credit for the good deeds, or whether they understand them as the self-interested efforts of a profit-making firm to look good.

In business you deal with people, real human beings. None of us are the perfectly rational Homo economicus. So leaders also need to understand what behavioral science tells us about how customers make decisions. When do they maximize utility and when do they deviate? What can marketing tell us about the processes by which they make decisions?

Q: Along the lines of purely rational models being challenged by imperfect human behavior, would you describe your work on couples’ finances?

Generally, research on interpersonal relationships shows that birds of a feather flock together. We were curious whether that held for couples’ attitudes towards spending. We ended up finding that married couples tend to choose their opposite. Tightwads chose spendthrifts. Spendthrifts chose tightwads. We do not know for sure why, but there’s evidence that people choose mates who are their opposites in qualities they dislike about themselves. Maybe people wish they had a different attitude toward spending.

In theory, this complementarity might balance out the couple. However, in this case we found the difference led to conflict about finances and hurt marital wellbeing. Obviously, it doesn’t hold for every single couple. But, with this characteristic, difference is the norm, and the couples who are different argue about money more than couples who are matched.

Q: You’ve also recently co-authored a paper on the impact of couples merging finances.

That was the craziest experiment I’ve ever been involved in. The lead author, who is now a professor at Indiana University, recruited participants by going to wedding shows, posting on Craigslist, and even sending a flyer using a jeweler’s mailing list. It took a lot of effort, but eventually she enrolled 230 engaged or recently-married couples to be part of an experiment.

Once we had the couples enrolled, they were randomly assigned to either merge their finances or keep them separate. Then we tracked them over two years, asking all kinds of questions about their relationships to determine which approach led to happier outcomes.

We found that couples who merged their finances stayed happier longer. We can’t say sharing accounts is good for everyone. There certainly could be downsides, but on average couples that merged finances were happier than those who didn’t.

Q: How did this build on existing work?

Previous studies had showed a correlation between relationship satisfaction and merging finances, but because the couples in those studies had already chosen to either merge or keep separate, it was impossible to know whether merging finances led to happier outcomes or whether happier couples were the ones to merge finances.

We wanted to do a true randomized experiment that would answer the causation question. We didn’t know quite what we were getting ourselves into. It’s a big ask for people to participate over two years. From concept to publishing the paper, it took eight years.

We don’t have perfect evidence for exactly why couples that merge finances stay happier. We think a shared bank account fosters transparency, trust, and a feeling of communality in the relationship—thinking of things as ours rather than as “this is mine and that is yours.”

Q: There’s also an element of reframing in your recent work on generosity. Would you explain that experiment?

We did a field experiment with DonorsChoose, a large online nonprofit that allows individuals to donate directly to public school classroom projects. After someone makes a donation they get a message asking them to tell their friends and family about the donation on Facebook or Twitter or via email.

In other situations, some donors seem glad to publicize their generosity. When someone donates a significant amount to a theater, hospital, or university it’s common to see a room, a building, even a school named after them. Since my workplace is a university campus, I see that all the time. But the data from DonorsChoose revealed that very few people were willing to share about their donations online, when asked.

We have evidence that it’s because people feel inauthentic or braggy when they do share it. They feel they’re saying, “Look at me. Look how generous I am.” It’s as if getting credit for your action makes you less generous.

We conducted a field experiment to find out whether changing the framing of the act of sharing made a difference. After donating people got a message that said if you would like to magnify your impact, share it with friends and family. By presenting it as a way to do more good, we got more people to share. It wasn’t a huge effect, but it was a clear shift. The nudge made a difference. You could argue that the most generous person is the one who is willing to look like a braggart in order to have more impact.

I really liked this project because it was right at the intersection of two ways in which I’ve thought a lot about generosity: the purity of the motive and the impact of the action.

Q: What drew you to generosity as a topic for research?

I didn’t start with a grand vision. In graduate school, I knew that I wanted to study people and have some positive societal impact.

My first research project focused on what’s called the identifiable victim effect, which is our tendency to respond very sympathetically and generously when there’s a single identified victim, whereas we’re not very generous toward statistical victims. When a single person is kidnapped and the victim’s picture is put all over the media there’s lots of moral caring and action. Whereas a report on the thousands of people suffering around the world doesn’t trigger the same response.

I thought it was an interesting decision-making bias. If we were rational, we ought to devote resources to where we can help the most people or have the greatest impact. But there’s something special about a compelling story of a single person. It’s more human, more relatable. We generate more empathy for a single person than we do for many.

I had a sense that if we could understand the psychology that gets in the way of allocating resources in the ways that can have the greatest impact, that would have a significant societal impact. So I started with that. That project led to another and another.

Academic research is solving a problem. You have a question or a hypothesis or observe a pattern and want to understand. You want to add knowledge to the world. And that initial work and the research that followed has practical relevance. For my research on generosity, that means sharing insights for how best to appeal to donors.

Q: Where does your work fit in the wider field studying marketing?

Marketing is a broad and dynamic field. It’s an interdisciplinary field. Some people approach marketing questions focused on applications of economics and statistics. Others, such as myself, approach questions more focused on applications of psychology. But there are many shades of gray. Many people I admire straddle those approaches.

What research questions are considered “marketing” has changed over time. The first paper I published in an academic marketing journal was about why people give to a specific cause—the work I mentioned earlier where people give to fight breast cancer when they know someone who has had breast cancer. They give to Alzheimer charities when they know someone who has suffered from it. When that paper was published in 2008, it was among the first on generosity in the Journal of Consumer Research, perhaps the leading journal on consumer behavior. Now they publish papers on generosity regularly. That same broadening is happening in many academic marketing journals and in the questions being addressed by marketing faculty.

Q: Who influenced and shaped your thinking?

There are so many people who have mentored and inspired me that it’s impossible to mention some names and not leave important people out. I will say that in recent years nearly all of my collaborators have been PhD students or former students. They influence me. Their energy grabs my attention and makes me curious about things that I wouldn’t otherwise have been interested in.

In many cases, they are more tuned in to the latest things. Trends, for sure, but new methodologies, new tools, new resources. It’s energizing to work with people with fresh perspectives.

Q: Many people are curious to know things like whether merging finances with a partner is good for overall happiness in the relationship. However, few people are willing to chase an answer for eight years. What makes you willing to stick with it?

I don’t know if I have a great answer. Maybe, if anything, I have the patience, not always but often enough, to see it through. I would like to believe it is all because of my curious nature. But the truth is that academia rewards focus and self-discipline. We’re all products of our environment and affected by the incentives of the system that we’re in.

Q: How do you think about impact?

The purpose of my work is to understand human decision-making not just in a theoretical way but in a way that lets us develop solutions to problems.

I aim to do this not just in my research, but also in my teaching and service outside of academia. I’m on the research committee at the Ad Council, and I’m part of the Generosity Commission. All of these activities reinforce each other.

Q: What drew you to Yale SOM?

Two things make Yale SOM a perfect fit for me. The mission is focused on business and society. With both the students and the faculty, there’s interest in for-profit businesses and public policy and social entrepreneurship and nonprofit management and all the shades in between. That’s a really nice fit for my research and teaching interests. I teach a course to PhD students on moral consumer behavior. The main MBA course I teach is called “Behavioral Science for Social Good.”

The other thing is that the faculty and students are fantastic. It’s an environment where I can continue to grow and learn.

Department: Faculty Viewpoints