What are the marginal effects of donating with an employer gift match? The one I have has a per-employee cap and no overall cap, but presumably the utilization rate negatively influences the cap. How much credit should I be giving myself for the gifts I cause my employer to give?
If the notion of ‘credit’ is too poorly defined, suppose I were deciding between job A which has a gift match and job B which has a higher salary, such that (my personal gift if I take job A) < (my total gift if I take job B) < (my total gift including match if I take job A).
This would depend the company’s response to match utilization, how effective the average donor at the company is (since my effects on the match cap are distributed across all such donors), and the marginal effects of the company having money.
One note is that the company is probably much more reluctant to lower the cap than to reduce a planned increase, so if I expect the cap to increase donating probably cuts into that, but if I expect it to stay the same donating may not have any effect on the cap.
If your employer responds to the number of employees who are giving by modifying the cap, then that means that whether or not you give will not change how much money your employer gives in the long term.
However, even if that is true, you still are choosing where your employer donates your portion of the gift match. Therefore, if you believe that most of the money given to charity is being used at only moderate effectiveness, but that you could choose a good givewell charity to donate to and achieve much greater results, then the impact of the employee match is still signficant.
Given that the most effective charities are at least an order of magnitude more effective, probably more than that, than average charities, any decrease you cause to other people’s matches is probably insignificant compared to the match you get.
What are the marginal effects of donating with an employer gift match? The one I have has a per-employee cap and no overall cap, but presumably the utilization rate negatively influences the cap. How much credit should I be giving myself for the gifts I cause my employer to give?
If the notion of ‘credit’ is too poorly defined, suppose I were deciding between job A which has a gift match and job B which has a higher salary, such that (my personal gift if I take job A) < (my total gift if I take job B) < (my total gift including match if I take job A).
This would depend the company’s response to match utilization, how effective the average donor at the company is (since my effects on the match cap are distributed across all such donors), and the marginal effects of the company having money.
One note is that the company is probably much more reluctant to lower the cap than to reduce a planned increase, so if I expect the cap to increase donating probably cuts into that, but if I expect it to stay the same donating may not have any effect on the cap.
Anything else to think about?
If your employer responds to the number of employees who are giving by modifying the cap, then that means that whether or not you give will not change how much money your employer gives in the long term.
However, even if that is true, you still are choosing where your employer donates your portion of the gift match. Therefore, if you believe that most of the money given to charity is being used at only moderate effectiveness, but that you could choose a good givewell charity to donate to and achieve much greater results, then the impact of the employee match is still signficant.
Given that the most effective charities are at least an order of magnitude more effective, probably more than that, than average charities, any decrease you cause to other people’s matches is probably insignificant compared to the match you get.