Handbook of the Economics of Giving, Altruism and Reciprocity

by Kolm; Mercier Ythier

• ISBN13: 9780444521453
• ISBN10: 0444521453
• Format: Hardcover
• Copyright: 2006-09-08
• Publisher: Elsevier Science

Summary

The Handbook on the Economics of Giving, Reciprocity and Altruism provides a comprehensive set of reviews of literature on the economics of nonmarket voluntary transfers. The foundations of the field are reviewed first, with a sequence of chapters that present the hard core of the theoretical and empirical analyses of giving, reciprocity and altruism in economics, examining their relations with the viewpoints of moral philosophy, psychology, sociobiology, sociology and economic anthropology. Secondly, a comprehensive set of applications are considered of all the aspects of society where nonmarket voluntary transfers are significant: family and intergenerational transfers; charity and charitable institutions; the nonprofit economy; interpersonal relations in the workplace; the Welfare State; and international aid. *Every volume contains contributions from leading researchers *Each Handbook presents an accurate, self-contained survey of a particular topic *The series provides comprehensive and accessible surveys

Table of Contents

Introduction to the Series	v
Contents of the Handbook	vii
Preface to the Handbook	xi
PART 2: FAMILY TRANSFERS
Chapter 13 Microeconomic models of family transfers
ANNE LAFERRERE AND FRANCOIS-CHARLES WOLFF	889	(82)
Abstract	890	(1)
Keywords	891	(1)
1. What families are made of	892	(1)
2. Altruism, or the power of families	893	(22)
2.1. The eight pillars of pure one-sided altruism, and redistributive neutrality	894	(4)
2.2. Two-sided altruism	898	(3)
2.3. Multiple recipients or multiple donors	901	(6)
2.4. Extending the model to endogenous incomes	907	(7)
2.5. Daddy knows best	914	(1)
3. Impure altruism: merit good and transfers as a means of exchange	915	(18)
3.1. Child's effort as a merit good	916	(1)
3.2. Buying or extorting the child's services or the parent's inheritance	917	(8)
3.3. Transfers as family loans	925	(3)
3.4. Family insurance and banking	928	(1)
3.5. Decisions within the family: altruism and collective models	929	(3)
3.6. Pure and impure altruism	932	(1)
4. Non-altruism: transfers as old-age security	933	(6)
4.1. The mutuality model or how to glue the generations together	934	(4)
4.2. Old age support: other mechanisms	938	(1)
5. The formation of preferences	939	(9)
5.1. To imitate or to demonstrate?	939	(3)
5.2. Cultural transmission and endogenous preferences	942	(6)
6. Tests of family transfer models	948	(10)
6.1. Who gives what, and to whom?	948	(3)
6.2. Institutions and family transfers	951	(1)
6.3. The limited scope of pure altruism	952	(4)
6.4. Tests of family mutuality models	956	(2)
7. Conclusion: homo reciprocans, or living in a world of externalities	958	(3)
References	961	(10)
Chapter 14 Altruism, exchange or indirect reciprocity: what do the data on family transfers show?
LUC ARRONDEL AND ANDRE MASSON	971	(84)
Abstract	974	(1)
Keywords	974	(1)
1. Introduction	975	(5)
1.1. Motivations: transfers governed by indirect reciprocities	976	(2)
1.2. Outline of the paper	978	(2)
2. Altruism, exchange, and other motives: a quick reminder	980	(8)
2.1. "Involuntary" transfers: accidental or entrepreneurial bequests	981	(1)
2.2. Altruism	982	(3)
2.3. Exchange	985	(1)
2.4. Summing up: distinctive predictions of basic transfer models	986	(2)
3. Heterogeneity of (financial downward) transfers	988	(7)
3.1. Foreword: how to define "transfers" between living generations?	988	(1)
3.2. Three types of financial inter vivos transfers	989	(4)
3.3. The importance of "inherited" wealth in total wealth accumulation	993	(1)
3.4. The importance of "gifts" (inter vivos transfers) relative to bequests	994	(1)
4. Previous tests of transfer models	995	(11)
4.1. Accidental bequests do not apply to the richer part of the population	995	(2)
4.2. Parental altruism cannot explain non-compensatory gifts or bequests	997	(4)
4.3. Parent-child exchange: non specific predictions, weak attention-bequest correlation	1001	(2)
4.4. Negative conclusions on the empirical front?	1003	(3)
5. More on inter vivos transfers in developed countries	1006	(15)
5.1. New demographic insights	1006	(3)
5.2. The asymmetry of (financial) transfers given mainly to younger generations	1009	(3)
5.3. Time or financial assistance to elderly parents: not a dual exchange	1012	(3)
5.4. Introducing extended 2-regimes forms of altruism and intertemporal exchange	1015	(6)
6. Indirect reciprocities between generations: theory	1021	(8)
6.1. Reciprocity between generations in the family	1022	(2)
6.2. General reciprocity: "rebound" and "propagation" effects	1024	(3)
6.3. Four types of intergenerational indirect "serial" reciprocities	1027	(2)
7. Indirect reciprocities: preliminary French and U.S. evidence	1029	(8)
7.1. "Retrospective effects" on parent-to-child inter vivos transfers and bequests	1030	(1)
7.2. Discussion: robustness of retrospective effects on parent-to-child transfers	1031	(3)
7.3. Dynastic transmission behavior (forward-downward type)	1034	(1)
7.4. Child-to-parent transfers: demonstration effects and other indirect reciprocities	1035	(2)
8. Economic implications of family transfers (prolegomena)	1037	(8)
8.1. Standard views	1038	(2)
8.2. Social security, education and growth (more elaborate transfer models)	1040	(2)
8.3. The circuit of intergenerational private and public transfers: which Welfare State?	1042	(1)
8.4. Distributive issues	1043	(2)
9. Conclusions	1045	(3)
9.1. Heterogeneity of transfers and motives for transfers	1045	(1)
9.2. Looking for models of mixed motivations	1045	(1)
9.3. Reproducing the circulation of private transfers between generations	1046	(1)
9.4. What about family transfers in less developed countries?	1047	(1)
9.5. Intergenerational indirect reciprocities as an outcome of individual rationality?	1047	(1)
References	1048	(7)
Chapter 15 Intergenerational altruism and neoclassical growth models
PHILIPPE MICHEL, EMMANUEL THIBAULT AND JEAN-PIERRE VIDAL	1055	(52)
Abstract	1056	(1)
Keywords	1057	(1)
1. Introduction	1058	(2)
2. The behaviour of altruistic households	1060	(8)
2.1. The two-period overlapping generations model	1061	(1)
2.2. Modelling the bequest motive	1061	(2)
2.3. Expectations and optimal choices	1063	(4)
2.4. Small open economy	1067	(1)
3. The intertemporal equilibrium	1068	(9)
3.1. Definitions	1069	(2)
3.2. The Cobb–Douglas case	1071	(3)
3.3. Comparison with the social optimum	1074	(3)
4. Steady state	1077	(5)
4.1. Steady state with positive bequests	1077	(3)
4.2. Steady state with zero bequests	1080	(1)
4.3. Existence and multiplicity of steady states	1081	(1)
5. Fiscal policy	1082	(4)
5.1. Neutrality of government debt	1082	(2)
5.2. Neutrality of pay-as-you-go social security	1084	(1)
5.3. Nonneutrality of estate taxation	1084	(1)
5.4. Neutrality of high debts	1085	(1)
6. Heterogenous altruistic dynasties	1086	(5)
6.1. Steady state	1087	(2)
6.2. Government debt	1089	(1)
6.3. Pay-as-you-go social security and estate taxation	1090	(1)
7. Other forms of altruism	1091	(6)
7.1. Others forms of pure altruism	1091	(3)
7.2. Ad hoc altruism	1094	(3)
8. Extensions	1097	(6)
8.1. Altruism and education	1097	(3)
8.2. Altruism and environment	1100	(3)
9. Conclusion	1103	(1)
References	1104	(3)
Chapter 16 Wealth transfer taxation: a survey of the theoretical literature
HELMUTH CREMER AND PIERRE PESTIEAU	1107	(28)
Abstract	1108	(1)
Keywords	1108	(1)
1. Introduction	1109	(1)
2. Bequest motives	1110	(4)
2.1. Taxonomy of transfers motives	1111	(1)
2.2. Canonical model	1112	(2)
3. Optimal taxation of factor income and wealth transfer	1114	(11)
3.1. The overlapping generation model	1114	(3)
3.2. Accidental bequest	1117	(1)
3.3. Pure altruism	1117	(2)
3.4. Joy of giving	1119	(1)
3.5. Exchange	1120	(2)
3.6. Inequality and wealth transfer taxation	1122	(3)
4. Miscellaneous issues	1125	(7)
4.1. Estate taxation or inheritance taxation	1125	(1)
4.2. Inter vivos gifts versus bequests	1126	(1)
4.3. Mixed motives	1127	(3)
4.4. Unobservability of inherited wealth	1130	(1)
4.5. Investment in the human capital of children	1131	(1)
5. Conclusion	1132	(1)
References	1132	(3)
Chapter 17 The economics of migrants' remittances
HILLEL RAPOPORT AND FREDERIC DOCQUIER	1135	(66)
Abstract	1136	(1)
Keywords	1137	(1)
1. Introduction	1138	(3)
2. The microeconomics of remittances	1141	(30)
2.1. Theory	1143	(22)
2.2. Evidence	1165	(6)
3. The macroeconomics of remittances	1171	(23)
3.1. Short-run approaches	1172	(4)
3.2. The long-run view	1176	(10)
3.3. Evidence on the growth effects of remittances	1186	(8)
4. Conclusion	1194	(1)
References	1195	(6)
PART 3: THIRD SECTOR AND LABOR
Chapter 18 Philanthropy
JAMES ANDREONI	1201	(70)
Abstract	1202	(1)
Keywords	1203	(1)
1. Introduction	1204	(1)
2. General facts on philanthropy	1205	(55)
2.1. Giving in the USA	1205	(4)
2.2. International statistics	1209	(3)
3. Theoretical foundation	1212	(1)
3.1. A model of private giving to public goods	1212	(3)
3.2. Neutrality: crowding out	1215	(2)
3.3. Neutrality: reductio ad absurdum	1217	(3)
3.4. Warm-glow giving	1220	(3)
3.5. The dominance of warm-glow	1223	(1)
4. Should warm-glow count in social welfare?	1224	(3)
5. Optimal tax treatment of charitable giving	1227	(3)
6. Gifts of cash: price and income elasticities	1230	(1)
6.1. Econometric issues in measuring the effects of price and income	1231	(4)
6.2. A brief history of empirical studies on charitable giving	1235	(1)
6.3. Randolph's 1995 JPE paper	1236	(2)
6.4. Auten, Sieg and Clotfelter's 2002 AER paper	1238	(3)
7. Gifts by the very wealthy	1241	(1)
7.1. Tax consequences of gifts by the wealthy	1241	(4)
7.2. Differences in giving behavior	1245	(2)
7.3. Tax elasticity of gifts in life and at death	1247	(1)
8. Giving time	1248	(1)
8.1. Theoretical framework for volunteering	1249	(1)
8.2. Empirical studies on gifts of time and money	1250	(2)
9. Fund-raising: charities as strategic players	1252	(1)
9.1. Capital campaigns	1253	(3)
9.2. Continuing campaigns	1256	(3)
9.3. What remains to be done	1259	(1)
10. Empirical analyses of fund-raising, government grants and crowding out	1260	(4)
10.1. Background studies	1260	(1)
10.2. Endogeneity bias in grants	1261	(1)
10.3. What's crowded out, giving or fund-raising?	1262	(2)
11. Conclusion: the future of giving research	1264	(1)
References	1265	(6)
Chapter 19 Donative nonprofit organizations
MARC BILODEAU AND RICHARD STEINBERG	1271	(64)
Abstract	1272	(1)
Keywords	1273	(1)
1. Introduction	1274	(1)
2. What is a private nonprofit organization?	1275	(6)
2.1. Nondistribution	1275	(2)
2.2. Nongovernmental	1277	(1)
2.3. Organization	1278	(2)
2.4. Corollaries and correlates	1280	(1)
3. Dimensions of the nonprofit sector	1281	(8)
3.1. Size of the sector	1281	(1)
3.2. Scope of the sector	1282	(3)
3.3. Revenue mix	1285	(4)
4. Models of nonprofit organizations	1289	(18)
4.1. Agency problems and the nondistribution constraint	1289	(2)
4.2. Strategic investment by the intermediary	1291	(1)
4.3. Choosing between sectors	1292	(1)
4.4. Profitable nonprofits	1293	(3)
4.5. Excludable public goods	1296	(1)
4.6. Entrepreneurial sorting	1297	(1)
4.7. Multiple public goods	1298	(5)
4.8. Internal agency problems	1303	(2)
4.9. The long run	1305	(2)
5. Modeling nonprofit behaviors	1307	(19)
5.1. Fundraising	1307	(9)
5.2. Pricing and non-price rationing	1316	(5)
5.3. Labor	1321	(3)
5.4. Capital	1324	(2)
6. Conclusion	1326	(1)
References	1326	(9)
Chapter 20 The economics of organ transplantation
EMANUEL D. THORNE	1335	(36)
Abstract	1336	(1)
Keywords	1336	(1)
1. Introduction	1337	(3)
2. Why is there a ban on an organ market?	1340	(4)
2.1. The efficiency of relying on altruism	1341	(1)
2.2. Reliance on altruism as a fix for market failures—broadly and narrowly	1342	(2)
3. The conventional economic analysis of the effect of banning a market	1344	(2)
3.1. The model	1344	(1)
3.2. Critiques of the conventional model	1345	(1)
4. Procuring market-inalienable organs by exhorting donors	1346	(12)
4.1. The exhortation effort model	1346	(4)
4.2. The common property nature of human organs	1350	(8)
5. Why the organ shortage?	1358	(6)
5.1. Spain's extraordinary success	1358	(4)
5.2. Relying on exhortation	1362	(1)
5.3. Organs are procured by nonprofit organizations	1363	(1)
5.4. Problems with nonprofits	1363	(1)
5.5. Government oversight	1363	(1)
6. What to do about the organ shortage	1364	(3)
6.1. Market-like schemes	1364	(1)
6.2. A proposal to allow a secondary market between the nonprofit procurers and hospitals	1365	(2)
7. Conclusion	1367	(1)
References	1368	(3)
Chapter 21 Altruism, reciprocity and cooperation in the workplace
JULIO J. ROTEMBERG	1371	(38)
Abstract	1372	(1)
Keywords	1372	(1)
1. Introduction	1373	(1)
2. Workers cooperating with employers	1374	(17)
2.1. Reciprocity and the gift-exchange model	1376	(7)
2.2. Individuals who subscribe to high-effort norms	1383	(2)
2.3. Altruism from the worker to his employer	1385	(6)
3. Workers cooperating with each other	1391	(9)
3.1. Theory	1392	(4)
3.2. Evidence	1396	(4)
4. Altruism towards subordinates	1400	(3)
5. Conclusions	1403	(2)
References	1405	(4)
Chapter 22 Reciprocity, altruism, and cooperative production
LOUIS PUTTERMAN	1409	(30)
Abstract	1410	(1)
Keywords	1410	(1)
Introduction	1411	(1)
1. Group production, incentive problems, and the social element in their resolution	1411	(3)
2. Incentives, effort interdependence, and interdependence of rewards in cooperatives	1414	(6)
3. Altruism and reciprocity	1420	(2)
4. Some evidence from experimental economics	1422	(5)
5. From laboratory results to the cooperative workplace	1427	(2)
6. Reciprocity and cooperation in other settings	1429	(1)
7. Conclusion	1430	(1)
References	1431	(8)
PART 4: THE POLITICAL ECONOMY OF VOLUNTARY TRANSFERS
Chapter 23 Strong reciprocity and the welfare state
CHRISTINA M. FONG, SAMUEL BOWLES AND HERBERT GINTIS	1439	(26)
Abstract	1440	(1)
Keywords	1440	(1)
1. Introduction	1441	(4)
2. The origins of strong reciprocity	1445	(2)
3. Experimental evidence	1447	(3)
4. Survey evidence	1450	(7)
5. Strong reciprocity and the welfare state: unhappy marriage?	1457	(3)
6. Conclusion	1460	(1)
Appendix A	1461	(1)
References	1462	(3)
Chapter 24 Selfishness, altruism and normative principles in the economic analysis of social transfers
DIDIER BLANCHET AND MARC FLEURBAEY	1465	(40)
Abstract	1466	(1)
Keywords	1466	(1)
1. Introduction	1467	(3)
2. Social transfers for selfish agents: core arguments of efficiency theories of the welfare state	1470	(6)
2.1. Inefficiencies in the private provision of insurance	1470	(4)
2.2. Inefficiencies in the private management of life-cycle transfers	1474	(2)
3. Redistributive transfers under selfishness	1476	(8)
3.1. Redistributive features of ST	1476	(2)
3.2. Forms of redistribution that remain amenable to efficiency arguments	1478	(2)
3.3. Forms of redistribution that are not amenable to efficiency arguments	1480	(1)
3.4. Redistribution that can be explained by political processes	1481	(3)
4. Social transfers under altruism I: intra and intergenerational altruism as support for extended insurance	1484	(6)
4.1. A normative benchmark: redistribution as extended insurance	1485	(1)
4.2. Altruism and support for partial extensions of insurance	1486	(2)
4.3. Extended insurance and altruism under incentive constraints	1488	(2)
5. Social transfers under altruism II: other normative principles for a well-defined altruism?	1490	(10)
5.1. Some pitfalls of fundamental insurance	1491	(3)
5.2. Social welfare with an egalitarian flavor	1494	(2)
5.3. Equity criteria in search of second-best applications	1496	(2)
5.4. Altruistic preferences and social welfare	1498	(2)
6. Conclusion	1500	(1)
References	1501	(4)
Chapter 25 The political economy of intergenerational cooperation
ALESSANDRO CIGNO	1505	(54)
Abstract	1506	(1)
Keywords	1506	(1)
1. Introduction	1507	(3)
2. A normative benchmark	1510	(3)
3. The market	1513	(4)
3.1. A life-cycle model	1513	(1)
3.2. A dynastic model	1514	(3)
4. The family	1517	(11)
4.1. Self-enforcing family constitutions	1518	(5)
4.2. Picking a constitution	1523	(2)
4.3. Uncertainty and the demand for attention	1525	(1)
4.4. Altruism in a family constitution context	1526	(2)
5. The state	1528	(3)
6. Education	1531	(4)
6.1. Market equilibrium and education policy	1531	(2)
6.2. Families again	1533	(2)
7. Uncertainty and hidden actions	1535	(7)
7.1. Parents as government agents	1536	(2)
7.2. The government as principal	1538	(4)
8. Political acceptability	1542	(12)
8.1. A social compact?	1543	(2)
8.2. Direct democracy	1545	(5)
8.3. Representative democracy	1550	(4)
9. Conclusion	1554	(2)
References	1556	(3)
Chapter 26 The economics of international aid
RAVI KANBUR	1559
Abstract	1560	(1)
Keywords	1560	(1)
1. Introduction	1561	(1)
2. The history of aid	1562	(7)
2.1. The origins of modern aid	1562	(2)
2.2. Evolution of the aid doctrine before and after the cold war	1564	(5)
3. The theory of aid	1569	(7)
3.1. Unconditional international transfers	1569	(3)
3.2. Conditionality	1572	(4)
4. Empirical and institutional analysis of aid	1576	(7)
4.1. Development impact of aid	1577	(2)
4.2. Aid dependence	1579	(1)
4.3. International public goods and aid	1580	(3)
5. Conclusion	1583	(2)
References	1585
Author Index of Volume 2	I-1
Subject Index of Volume 2	I-17