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Should Egalitarians Expropriate Philanthropists?

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  • Dasgupta, Indraneel
  • Kanbur, Ravi

Abstract

Wealthy individuals often voluntarily provide public goods that the poor also consume. Such philanthropy is commonly perceived as legitimizing one’s wealth. Governments routinely exempt the rich from taxation on grounds of their charitable expenditures. We examine the logic of this exemption. We show that, rather than reducing inequality, philanthropy may actually exacerbate absolute inequality, while leaving the change in relative inequality ambiguous. Additionally, philanthropic preferences may increase the effectiveness of policies to redistribute income, instead of weakening them. Consequently, from an egalitarian perspective, the general case for exempting the wealthy from expropriation, on grounds of their public goods contributions, appears dubious.

Suggested Citation

  • Dasgupta, Indraneel & Kanbur, Ravi, 2007. "Should Egalitarians Expropriate Philanthropists?," Working Papers 126999, Cornell University, Department of Applied Economics and Management.
  • Handle: RePEc:ags:cudawp:126999
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    1. Richard Cornes & Todd Sandler, 2000. "Pareto-Improving Redistribution and Pure Public Goods," German Economic Review, Verein für Socialpolitik, vol. 1(2), pages 169-186, May.
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    5. Robert Breunig & Indraneel Dasgupta, 2005. "Do Intra-Household Effects Generate the Food Stamp Cash-Out Puzzle?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 87(3), pages 552-568.
    6. Richard Cornes, 1993. "Dyke Maintenance and Other Stories: Some Neglected Types of Public Goods," The Quarterly Journal of Economics, Oxford University Press, vol. 108(1), pages 259-271.
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    8. Andreoni, James, 1990. "Impure Altruism and Donations to Public Goods: A Theory of Warm-Glow Giving?," Economic Journal, Royal Economic Society, vol. 100(401), pages 464-477, June.
    9. Dasgupta, Indraneel & Kanbur, Ravi, 2007. "Community and class antagonism," Journal of Public Economics, Elsevier, pages 1816-1842.
    10. Buhong Zheng, 2007. "Unit-Consistent Decomposable Inequality Measures," Economica, London School of Economics and Political Science, vol. 74(293), pages 97-111, February.
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    14. Indraneel Dasgupta & Ravi Kanbur, 2005. "Community and anti-poverty targeting," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 3(3), pages 281-302, December.
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    Cited by:

    1. Indraneel Dasgupta, "undated". "Women or Children? Intra-household redistribution under gender-asymmetric altruism," Discussion Papers 07/10, University of Nottingham, CREDIT.
    2. Dasgupta, Indraneel & Kanbur, Ravi, 2007. "Community and class antagonism," Journal of Public Economics, Elsevier, pages 1816-1842.
    3. Dasgupta Indraneel, 2011. "Mother or Child? Intra-household Redistribution under Gender-Asymmetric Altruism," Journal of Globalization and Development, De Gruyter, vol. 2(1), pages 1-27, August.
    4. Atkinson, A.B., 2009. "Giving overseas and public policy," Journal of Public Economics, Elsevier, vol. 93(5-6), pages 647-653, June.

    More about this item

    Keywords

    Community; Public goods; Inequality; Distribution; Philanthropy; Egalitarianism.; Institutional and Behavioral Economics; Public Economics; D31; D63; D74; Z13.;

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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