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Title:Should egalitarians expropriate philanthropists? PDF Logo
Authors:Dasgupta, Indraneel
Kanbur, Ravi
Issue Date:2008
Series/Report no.:IZA Discussion Papers 3317
Abstract:Wealthy individuals often voluntarily provide public goods that the poor also consume. Such philanthropy is perceived as legitimizing one's wealth. Governments routinely exempt the rich from taxation on grounds of their charitable expenditure. We examine the normative logic of this exemption. We show that, rather than reducing it, philanthropy may aggravate absolute inequality in welfare achievement, 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, the general normative case for exempting the wealthy from expropriation, on grounds of their public goods contributions, appears dubious.
Subjects:Community
public goods
inequality
distribution
philanthropy
egalitarianism
JEL:D31
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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