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August 12, 2021

You’re right, the rich are different

While it’s laudable that Bill Gates and Warren Buffett have been able to convince 40 billionaires to donate at least half of their fortunes to worthy causes, don’t expect every wealthy magnate to jump on board.

It’s not in their nature, maintains Paul Piff, a psychology researcher at the University of California, Berkeley. According to his research, poor people are actually more charitable than the rich.

Piff and his team had participants fill out an online questionnaire asking them to outline their socio-economic status. He then brought them into the lab, explaining that they were each going to receive 10 credits, which would be worth cash at the end of the experiment.

The question: How many of those credits are you willing to give, if any, to a partner that you'll never meet and who'll never meet you.

Piff found that people who saw themselves as relative high in terms of socio-economic status were less inclined to give points away than those who were of more modest means.

The relatively lower-class individuals were inclined to give away 44% more of their credits, even when the effects of age, sex, ethnicity and religiousness had been accounted for, he explains.

And when quizzed as to what might be a reasonable amount to donate, lower-class participants, on average, thought that 5.6% of a person's income should go to charity whereas the more affluent put that figure at just 2.1%.

Piff suggests that the increased compassion which seems to exist among the poor increases generosity and helpfulness, largely because they rely less on economic resources and more on other people in their communities.

Others might suggest that those who have spent some time near the bottom know what it’s like and have empathy for others.

What do you think? Although the absolute dollar amounts will vary, are poorer people actually more generous than those with money?

By Gordon Powers, MSN Money



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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

James HaversJames Havers

James is the senior editor of MSN Money living in Toronto. He has worked for the Nikkei Shimbun (Tokyo),,, Canadian Business and other publications. Havers turned to journalism after teaching overseas.

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...