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Optimal redistributive charity
Umeå University, Faculty of Social Sciences, Umeå School of Business and Economics (USBE), Economics.
University of Gothenburg, Gothenburg, Sweden.
University of Graz, Graz, Austria.
2025 (English)In: Scandinavian Journal of Economics, ISSN 0347-0520, E-ISSN 1467-9442, Vol. 127, no 1, p. 3-45Article in journal (Refereed) Published
Abstract [en]

This paper analyzes optimal redistributive charitable giving in a Mirrleesian framework. The status motive behind charity, the stigma from receiving donations, and transaction costs all work to decrease the optimal marginal subsidies on redistributive charity. Because the existing empirical evidence of these effects (when available) is highly uncertain and context-dependent, the range of possible outcomes is large, and even includes the possibility that charitable giving should be taxed rather than subsidized. In a natural benchmark case, the optimal tax treatment of charitable giving is consistent with a simple tax credit, whereas pure tax deductions are never part of the optimal policy.

Place, publisher, year, edition, pages
John Wiley & Sons, 2025. Vol. 127, no 1, p. 3-45
Keywords [en]
optimal income taxation, Redistributive charitable giving, social status, stigma, warm glow
National Category
Economics
Identifiers
URN: urn:nbn:se:umu:diva-228271DOI: 10.1111/sjoe.12573ISI: 001279461500001Scopus ID: 2-s2.0-85200001821OAI: oai:DiVA.org:umu-228271DiVA, id: diva2:1888146
Funder
Swedish Research Council, 2016-02371Swedish Research Council, 2020-02208Marianne and Marcus Wallenberg Foundation, MMW 2015.0037Available from: 2024-08-12 Created: 2024-08-12 Last updated: 2025-01-12Bibliographically approved

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Aronsson, Thomas

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CiteExportLink to record
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Cite
Citation style
  • apa
  • ieee
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Language
  • de-DE
  • en-GB
  • en-US
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  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
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  • text
  • asciidoc
  • rtf