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Apr 12

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Renaming Hurricanes Probably Wouldn’t Have Increased Donations by $700 Million

Adam Alter, Professor of Marketing and Psychology at NYU, thinks that he’s found a way to increase aid donations in the aftermath of hurricanes. His solution: give hurricanes names with very common initials (e.g. “J” or “M”) because people allegedly donate more when Hurricanes share their first initial. To support his suggestion, Alter cites a study published in 2008 that found that:

“Individuals who shared an initial with the hurricane name were overrepresented among hurricane relief donors relative to the baseline distribution of initials in the donor population.”

With these findings in hand, Alter performed a “back-of-the-napkin” calculation to conclude that aid agencies would have attracted $700 million more in aid since 2000 under this “optimal” naming convention. I can think of at least three reasons to remain cautious about the benefits of changing the hurricane naming conventions:

  1. Substitution Effects. When donors contribute to a fund associated with a particular hurricane (e.g. “Hurricane Katrina Relief Fund”), they are likely to have satisfied their donation “need” and therefore refrain from making an additional donation to a more generic fund. Following this reasoning, when a fictional character named Kelly donates $100 to the Katrina fund, she probably won’t also donate to another disaster relief fund. The key question is whether Kelly would have donated $100 to any fund had the hurricane been named differently. Unfortunately, the 2008 cited above can’t answer this question because the researchers only had access to donors’ first names.
  2. Saturation Effects. If Hurricanes are named “optimally” as Alter suggests, the targeted population of “Johns,” “Marys,” and “Michaels” would be routinely hit up for donations due to the initial effect. These populations would likely become desensitized to hurricanes bearing a common first initial.
  3. Small donations problem. The 2008 study doesn’t (and can’t due to data limitations) determine whether a common initial induces donors to contribute large amounts. I would suggest (though I also lack the data to know for sure) that donations motivated by first initials would tend to be on the smaller side. Thus, even if we grant that common initials might increase the number of donors, we cannot assume that the amount of donations will increase proportionately as Alter likely did.

There are additional methodological shortcomings of the 2008 study (i.e. failure to control for confounding variables).  Overall, these criticisms would suggest that Alter is overly optimistic in believing his strategy for naming hurricanes will attract large sums of additional aid.

About the author

Benjamin Bohr

Benjamin is a manager at Fulcrum Financial Inquiry. He specializes in statistics and data analysis for use in high-stakes litigation, business valuations, and other financial matters.

Permanent link to this article: http://betweenthenumbers.net/2013/04/why-renaming-hurricanes-probably-wouldnt-have-increased-donations-by-700-million/

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