How to Get the Most from Goods Donated to Charities

The charity sector is assuming a central role in many countries, due to a generalized increase in wealth inequalities and the restructuring of the welfare state. This market, however, exhibits inefficiencies. In this work, we empirically test the adoption of a centralized truthful allocation mechanism without money to charities bidding for donations. Our results show that it is indeed possible to improve the income of the sector by at least 50% on average. We further show how the application of proxy bidding allows to maintain a significant portion of the welfare improvements without the need of many bids. Our results pave the way for a novel and more profitable model of distribution of donated goods.