Reducing the income-tax deductibility of charitable gifts is a less distortionary way to raise new revenue than raising the same amount of revenue through a proportional increase in all marginal tax rates.
Responses
© 2025. Kent A. Clark Center for Global Markets.
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18%
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Responses weighted by each expert's confidence
© 2025. Kent A. Clark Center for Global Markets.
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10%
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54%
16%
Participant |
University |
Vote |
Confidence |
Bio/Vote History |
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 Daron Acemoglu |
MIT | Bio/Vote History | ||
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 Alberto Alesina |
Harvard | Did Not Answer | Bio/Vote History | |
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 Joseph Altonji |
Yale | Bio/Vote History | ||
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 Alan Auerbach |
Berkeley | Bio/Vote History | ||
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 David Autor |
MIT | Bio/Vote History | ||
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Taxpayers subsidize too much non-meritorious activity through the tax writeoff. Tax liability should not fall 1-for-1 with charitable giving
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 Katherine Baicker |
University of Chicago | Bio/Vote History | ||
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 Marianne Bertrand |
Chicago | Bio/Vote History | ||
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 Raj Chetty |
Harvard | Bio/Vote History | ||
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 Judith Chevalier |
Yale | Bio/Vote History | ||
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 Janet Currie |
Princeton | Bio/Vote History | ||
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The wording implies that distortion is bad, but the point of the charitable deduction is to encourage charity, ie to "distort" behavior.
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 David Cutler |
Harvard | Bio/Vote History | ||
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This is true with no externalities; there are many externalities to charitable giving.
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 Angus Deaton |
Princeton | Bio/Vote History | ||
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If minimizing distortion is your target, though seems like a very odd one.
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 Darrell Duffie |
Stanford | Bio/Vote History | ||
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Less distortion, yes, but that is an efficiency issue to be traded off against the distributional effects. I would keep the deduction.
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 Aaron Edlin |
Berkeley | Bio/Vote History | ||
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Arguably charity involves an externality and so should be subsidized...the giver feels good (or wouldn't do it) and the recipient benefits.
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 Barry Eichengreen |
Berkeley | Bio/Vote History | ||
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If other distortions lead to underfunding organizations receiving charitable giving as a result of tax treatment then the answer may differ.
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 Ray Fair |
Yale | Bio/Vote History | ||
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 Pinelopi Goldberg |
Yale | Did Not Answer | Bio/Vote History | |
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 Claudia Goldin |
Harvard | Bio/Vote History | ||
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There is a free rider problem with regard to (good) charities. Removing the deduction could be more distortionary.
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 Austan Goolsbee |
Chicago | Bio/Vote History | ||
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Deductions/exemptions overall, yes. But charitable alone? Not clear.
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 Michael Greenstone |
University of Chicago | Bio/Vote History | ||
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this is only half of the equation. possible that charitable deduction is most efficient way to achieve other important social goals
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 Robert Hall |
Stanford | Bio/Vote History | ||
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Some but hardly all charitable giving generates public goods and thus relieves distortions. We should keep the good deductions only.
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 Bengt Holmström |
MIT | Bio/Vote History | ||
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 Caroline Hoxby |
Stanford | Did Not Answer | Bio/Vote History | |
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 Kenneth Judd |
Stanford | Bio/Vote History | ||
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 Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
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 Pete Klenow |
Stanford | Bio/Vote History | ||
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 Jonathan Levin |
Stanford | Did Not Answer | Bio/Vote History | |
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 Eric Maskin |
Harvard | Bio/Vote History | ||
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 William Nordhaus |
Yale | Bio/Vote History | ||
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Poorly conceived question. This is a tax expenditure. Why not compare to sequester as non-distortionary way to raise revenues.
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 Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
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Of course,the tax distortion aspect alone doesn't take account of possible social benefits from charitable giving. It is a narrow criterion.
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 Emmanuel Saez |
Berkeley | Bio/Vote History | ||
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 José Scheinkman |
Columbia University | Bio/Vote History | ||
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 Richard Schmalensee |
MIT | Bio/Vote History | ||
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 Hyun Song Shin |
Princeton | Bio/Vote History | ||
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 Nancy Stokey |
University of Chicago | Bio/Vote History | ||
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Altruism is one motive for charity, and standard conclusions about "distorting" effects of taxes may not apply in settings with altruism.
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 Richard Thaler |
Chicago Booth | Bio/Vote History | ||
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The current system stinks. Why subsidize contribtions mostly of rich home-owners? Either kill it or make it a % credit that applies to all.
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 Christopher Udry |
Northwestern | Bio/Vote History | ||
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 Luigi Zingales |
Chicago Booth | Bio/Vote History | ||
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