Corporate Philanthropy and the Market for Altruism
M. Todd Henderson
University of Chicago - Law School
University of Chicago - Law School; University of Chicago Pritzker School of Medicine; Resources for the Future; National Bureau of Economic Research (NBER)
September 4, 2008
U of Chicago Law & Economics, Olin Working Paper No. 399
Columbia Law Review, Forthcoming
Academics and businesspeople have long debate the merits of corporate philanthropy. It is our contention that this debate is too narrowly focused on the role of corporations. There is a robust market for philanthropic works - which we call the market for altruism - in which non-profit organizations, the government, and for-profit corporations compete to do good works. We describe this market and the role corporations play in satisfying the demand for altruism. We conclude that corporations should only engage in philanthropy when they have a comparative advantage over non-profits and the government. Moreover, the government must avoid discriminating - particularly when setting tax policy - between non-profits and corporations that do good deeds.
Number of Pages in PDF File: 45
Date posted: April 14, 2008 ; Last revised: October 24, 2008
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