About Rationally Speaking
Rationally Speaking is a blog maintained by Prof. Massimo Pigliucci, a philosopher at the City University of New York. The blog reflects the Enlightenment figure Marquis de Condorcet's idea of what a public intellectual (yes, we know, that's such a bad word) ought to be: someone who devotes himself to "the tracking down of prejudices in the hiding places where priests, the schools, the government, and all long-established institutions had gathered and protected them." You're welcome. Please notice that the contents of this blog can be reprinted under the standard Creative Commons license.
Tuesday, July 17, 2007
Taxation vs. charitable donation: the way your brain sees it
Psychologists have suggested two models of human behavior to account for these phenomena: the “pure altruism” theory suggests that people are happy that something is done for the public good, regardless of whether this is achieved through taxation or donations. The alternative, “warm-glow” model says that people prefer charitable giving over taxation because they feel good about making personal decisions on how much to give and to whom (this, of course, entirely sidesteps the thorny problem of whether individuals who give to charities do so in an informed way, or whether their actions maximize social benefits).
An article recently published in Science (15 June) by William Harbaugh, Ulrich Mayr and Daniel Burghart (of the University of Oregon and the National Bureau of Economic Research) tackled the problem by looking directly at the brain activity of subjects facing various combinations of taxation and choice in charitable giving. The research was based on previous knowledge showing that some areas of the brain – in particular the ventral striatum and the insulae – are involved in providing information on the relative rewards of different choices made by a subject, including social rewards.
The results are both scientifically interesting and socially useful. First of all, it turns out that there are, in fact, altruists and selfish people (ok, no big surprise here). Altruists have a larger neural response when a charity is getting money rather then when the money goes to them, while the egoists' brains behave in the opposite fashion. Accordingly, altruists in the study were twice as likely to give money than egoists (58% vs. 31%).
More importantly, Harbaugh and collaborators found evidence for both the pure-altruist and the warm-glow theories: it turns out that while people do get a neural reward when they are responsible for the charitable choice, they also respond with (neural) satisfaction when they see increased payoffs going to charities through taxation – indeed, the same brain structures are responsible for both outcomes. In other words, at least at the level of brain function, there is no reason why we couldn't work toward a better society where people are fairly taxed to further the public good and at the same time they are encouraged through incentives to give money to charities. Whether the cultural, and particularly the political, forces at play will ever allow such a constructive merger between the American and the European models is, of course, an entirely different matter.