Should Egalitarians Expropriate Philanthropists?

Indraneel Dasgupta () and Ravi Kanbur ()

CEDI Discussion Paper Series from Centre for Economic Development and Institutions(CEDI), Brunel University

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.

Date: 2006-07
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Related works:
Working Paper: Should Egalitarians Expropriate Philanthropists? (2008)
Working Paper: Should Egalitarians Expropriate Philanthropists?
Working Paper: Should Egalitarians Expropriate Philanthropists? (2007)
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