Sunday, 11 September 2011

A theory of charity

Or, Kaldor-Hicks charity. 

An action is Pareto efficient if it makes some people better off without making anyone else worse off. Pareto efficiency is achieved if there are no actions remaining that can be made without making anyone worse off.

In practice, however, there are few actions that do not make at least some person worse off. An action is Kaldor-Hicks efficient if people made worse off could in theory be compensated. They do not actually have to be identified and compensated. This allows us to identify actions which move us closer to Pareto efficiency.

I claim that a charitable action should only be undertaken if the person receiving the charity could in theory compensate the person giving the charity. While this condition is not enough to make charity morally obligatory, I claim that if the condition is not fulfilled, it is morally obligatory not to give charity.

For example, if a homeless beggar could use an amount of capital to get back on his feet, he would then be able to pay back the capital (he doesn't -- that's why it's called charity, not a loan). The capital "makes a return"/"makes a (social) profit".

"You know it's so easy to lose everything. But it's so, so tough to get it back."

But if this wouldn't happen, then the charity is wasted. It would have been better spent on something else. We all want to maximise the good done by our charitable donations.
If charity does not "make a return" (in a Kaldor-Hicks sense) then it will just be required again, and again, and again.

Assisted suicide should be legal. 

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