BOULDER COUNTY, Colo. — In the days after the Marshall Fire, hundreds of crowdfunding accounts were created to help survivors whose homes were lost in the devastating blaze in December 2021.
Weeks after the fire, $23 million was raised for Marshall Fire victims.
A new study from researchers at the University of Colorado Boulder showed that those households that had higher incomes raised more money from crowdfunding sources than those households that had lower incomes.
“It became clear very quickly that wealthier people were not only more likely to have GoFundMe campaigns in the first place, but they also raised substantially more money in their GoFundMe campaigns,” said Emily Gallagher, assistant professor of finance at Leeds School of Business.
She authored the paper along with Tony Cookson, Leeds finance professor, and Phillip Mulder, assistant professor in the risk and insurance department at the Wisconsin School of Business at the University of Wisconsin-Madison.
Ten percent of fire survivors with a GoFundMe received more than $60,000, while 12% raised less than $5,000, according to the research. The households that received the most funding were more likely to be those with earnings above $150,000.
The study of 975 GoFundMe campaigns found that households making at least $150,000 received 28% more support than households that made under $75,000.
“Part of the reason why higher-income people raise more and are more likely to have GoFundMes is that they have advocates, they have friends who actually step in and start these campaigns for them,” Gallagher said. “Whereas if you're on the lower-income end and more financially vulnerable, it's less likely that someone outside of your family started a campaign.”
The study also found that wealthier recipients had bigger, more geographically dispersed networks of donors outside of the local area.
“Richer people have richer and deeper networks,” Cookson said. “Not only do they know people who are wealthier, but they have a wider network of people who they know.”
The researchers plan to submit their paper to a peer-reviewed journal next month.
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