And secondly – more importantly – what’s there to trust? Is there a secret reason why fighting leukemia is the most important cause in the world, the reason that only John knows but won’t tell us? Of course not.

I think the brain process here goes something like this: John is a much respected person -> a lot of people will listen to him and contribute -> fewer free-riders -> safe for me to contribute. Voila.

The signal can be a way to avoid free-riding (that, IIRC, is Tabbarok’s key point), but htere’s another kind of signalling as well. That is, I don’t really know much about the issue, but I trust John Quiggin’s judgment; if he’s willing to publically commit to it, I’m willing to support it because I trust his judgment. His “signal” is a public commitment; its value depends on how much I trust his judgment.

I’m saying that this only works only if you’re already inclined to contribute to this particular cause, but reluctant because you suspect that everybody else is free-riding. This is (imo) the only scenario when the signal is meaningful to you.

Same is the case with the telethons: you’re already interested in contributing -> you see many others contributing -> and you feel that, because you’re contributing along with a bunch of other people, you’re not a dupe (perhaps a mistake).

I forget the charity but showing early signs of an economic mind, or perhaps a lazy body, I decided that it would be much more efficient to get the money and avoid the running (today, I would say avoid the rent seeking). Thus, I solicited donations with the promise that I would run just one lap. Unsurprisingly, the other students were most displeased when I sauntered around the track finishing just as everyone else was beginning to work up a sweat. More surprisingly, the charity organizers didn’t like my methods even though I raised a lot of money.

If you run, it’s rational because you’re emitting a costly signal, and if you don’t, it’s rational because you raised the money efficiently by not wasting your time with all the stupid running.

Consider statements by three Johns (not the set-up to a hooker joke):

John1: Support charity X for reason Y.

John2: Support charity X for reason Y and I will run 5 miles.

John3 Support charity X for reason Y and I’ll drink beer.

John2 has made a costly signal of the value of charity X. The other Johns have not.

Re the football example, if you were deciding what football teams to support, you might say: team X’s fans paint their faces; team Y’s fans do not. I think team X’s fans demonstrate greater support for their team.

This is not rational. John could simply explain to you why he feels it’s important to give money to this leukemia fund; how does shaving his head help here? It does signal that he is very enthusiastic about this charity for some reason, but it doesn’t signal its worthiness to you.

People are enthusiastic about all kinds of things; football, for example – they paint their faces, fight, do all kinds of stuff. These are signals too, but what do I care?

Philanthropists use reciprocity of donations: I will give to your cause if you will give to mine. The signalling is vital here as well: I can ask you for a large donation only once I have already demonstrably and publicly committed to give my own larger donation.

The second type of signalling benefits the cause in other ways: AIDS Walks done en masse in the downtown core of cities with high profile sponsors signal that the issue is important and acceptable to a lot of people.

If a lot of people are visibly sacrificing their comfort on a weekend morning, the rest of the population will ask why. It’s a big signal.

Charitable givers often have their names listed in brochures, engraved on plaques, or, in extreme cases, have buildings named “in their honor”—all public attestations to their generosity. Conspicuous virtue.

Because this is a humanities issue. The point is not to find sufficient explanations, the point is to extend the discussion.

Well, OK, the only possible explanation I can think of is this:

Suppose I’m a very rich guy. Theoretically I would like to make a donation, but being (obviously) a greedy selfish SOB, I’m thinking: “Why should I suffer giving my money away while all these poor people around me don’t sacrifice anything? I know they don’t any money to donate, but they should sacrifice something, suffer in some other manner, it’s only fair.”

And so, then, when some poor guy offers to run a marathon for a particular charity – that satisfies my SOB-ish sense of justice and I donate.

This is the only meaningless context I can imagine.