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ON THE WELFARE COST OF TRANSFERS *

ON THE WELFARE COST OF TRANSFERS * EDGAR K. B R O W N I N G will enjoy the same benefits (or bear the same costs) regardless of whether or not they contribute. explanation of why individuals would lobby: ‘In any Consider TULLOCK’S situation in which transfers are likely, it must be assumed that profit-seeking individuals will invest resources in attempting to get them or prevent them, if the transfer is away from some individuals.' But the fact that high income taxpayers might collectiveb profit from investing in lobbying to reduce progression is no reason to suppose that it is in the individual interest of even a single one of them has to lobby. TULLOCK forgotten the free rider phenomenon. (It is worth mentioning that this is an instance where free rider behavior is a positive advantage in a social system. There are other examples; e.g., the free rider problem is a factor which inhibits collusive agreements among firms trying to establish a cartel.) Therefore, the ‘TULLOCK welfare loss’ would be nonexistent, or at most negligible, in this situation. TULLOCK’S argument is thus an incomplete explanation of the existence of lobbies, But lobbying activity is a prevalent feature of the political landscape, and we http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Kyklos International Review of Social Sciences Wiley

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Publisher
Wiley
Copyright
Copyright © 1974 Wiley Subscription Services, Inc., A Wiley Company
ISSN
0023-5962
eISSN
1467-6435
DOI
10.1111/j.1467-6435.1974.tb01912.x
Publisher site
See Article on Publisher Site

Abstract

EDGAR K. B R O W N I N G will enjoy the same benefits (or bear the same costs) regardless of whether or not they contribute. explanation of why individuals would lobby: ‘In any Consider TULLOCK’S situation in which transfers are likely, it must be assumed that profit-seeking individuals will invest resources in attempting to get them or prevent them, if the transfer is away from some individuals.' But the fact that high income taxpayers might collectiveb profit from investing in lobbying to reduce progression is no reason to suppose that it is in the individual interest of even a single one of them has to lobby. TULLOCK forgotten the free rider phenomenon. (It is worth mentioning that this is an instance where free rider behavior is a positive advantage in a social system. There are other examples; e.g., the free rider problem is a factor which inhibits collusive agreements among firms trying to establish a cartel.) Therefore, the ‘TULLOCK welfare loss’ would be nonexistent, or at most negligible, in this situation. TULLOCK’S argument is thus an incomplete explanation of the existence of lobbies, But lobbying activity is a prevalent feature of the political landscape, and we

Journal

Kyklos International Review of Social SciencesWiley

Published: Jan 1, 1974

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