Voting for environmental donations: Experimental evidence from Majorca, Spain

Abstract

This paper presents the results of a modified dictator game where donors are tourists in the island of Majorca, Spain, and the recipient is an environmental foundation. In this experiment we explore if the level of voluntary donations varies under different treatments that include taxes (high and low levels) and voting treatments on choosing and obligatory imposition of taxes (high vs. low and low vs. no tax). Our results show that participants only self-impose mandatory contributions when they must choose between a high or low tax, and rarely passing the high tax. In addition, we find that those individuals who voted for a high tax and are in a group where the majority votes for the low tax conform to their earlier vote by contributing more. Further, our data supports an incomplete crowding-out of voluntary donations by the application of tourism taxes ear-marked for environmental purposes. From a policy perspective, this result supports the potential for a complementary use of taxes and voluntary donations for fundraising environmental projects in tourism destinations.