Tax the Envious

by on September 3, 2006 at 7:16 am in Economics | Permalink

Tyler, Greg and Brad all forget the Coase theorem – all externalities are dual.  The solution to envy is not to tax the rich but to tax the envious.  To be envied is unpleasant.  People want to be admired but not envied.  To be envied is one step from being hated.  (Consider how much crime is motivated by envy.)  It’s envy which imposes an externality on the rich.  Make the envious pay for their ugly preferences.

Surprising analysis?  Not really – should gays be taxed because they make some people uncomfortable?  Hell no.  Tax the bigots for making gays feel unwelcome. 

finnsense September 3, 2006 at 8:25 am

The line between envy and injustice is a similarly thin as that between greed and desert. What those fond of talking about envy often refer to is merely the sense of injustice or unfairness felt by people intuitively unhappy at the distribution of goods.

Similarly, those who like talking about envy tend to dislike talking about greed. In both instances it comes down to our sense of what is fair and just and when someone has exceeded that line. You can tax who you think is envious if I can tax who I think is greedy.

Matthew Cromer September 3, 2006 at 9:56 am

Spot on!

Brad DeLong September 3, 2006 at 11:20 am

I thought that the problem was spite, and the solution was to tax the spiteful…

Matthew Cromer September 3, 2006 at 12:26 pm

Alex was not making a serious policy prescription, folks. . .

Sol September 3, 2006 at 2:00 pm

Aren’t government-run lottos/lotteries a pretty decent first approximation to a tax on envy?

Tom West September 3, 2006 at 5:21 pm

Um, I thought buying a lottery ticket was a license to dream about what you could do with a few million unearned dollars.

Of course, I’ve never figured out what buying a second lottery ticket got you…

Alex Tabarrok September 3, 2006 at 8:45 pm

The model of human psyche I am working with is the one I know best, my own! I don’t want to be envied and I don’t think that most people want to be envied. Admired yes, but envied no. I will grant that perhaps some screwed up people want to be envied (more or less equivalent to what Brad calls spite). It is certainly not the case, however, that the “the rich” in general want to be envied.

TGGP September 4, 2006 at 9:15 am

If the rich want to be envied, shouldn’t they be trying to move to poor neighborhoods where their consumption will be more conspicuous? Or do they really only have spite for people just slightly less rich then them?

Chairman Mao September 4, 2006 at 9:49 pm

We should declare war on envy like we’ve declared war on terror.

If gays were in the majority, do you believe that the tax burden would fall disproportionately on them?

nick September 6, 2006 at 3:14 am

Alex points up the only useful lesson to be learned from the questionable Coase theorem, namely that all externalities are dual. A practical solution to this problem is the low-cost avoider rule. Is it easier for the envied to live with the envy of others or for the envious to stop envying? Or on Brad’s original question, is it easier to stop being spiteful or easier to live with spite?

Something some Austrian said about subjective value and incomparability is raising its ugly head…

Tanner M. September 6, 2006 at 10:46 pm

I think this is just another scheming way to tax people for another dumbass reason. Envy is just another
human emotion that we cant help. The “less fortionate” are always going to be envyous or greedy of thoes
have more than them so what good are you going to do to tax someone that dosen’t have anything any way.
When you do this your only going to put the econmoy in to more debt causing the other taxes to rise.
When that happens you will be bitchin about your property tax, your federal tax and you income tax…ect.
So what do you think we will acommplish by taxing thoes who are envyous,not a damn thing.

levan September 12, 2006 at 4:19 am
Richard Bell August 25, 2008 at 12:07 am

We live in a world of injustice. There is excessive poverty on one scale and on the other scale there is excessive wealth. Both can and are influenced by envy!!! Class, Culture, Age and Gender are all affected by Envy!

Where does envy come from? It’s from the realisation that we are all created equal but chance has given some people something that others cannot have or lack. Lots of wealth, good looks, heroic strength, good business acumen…anything really.

So if envy comes from lack… who’s to be blamed for feeling this way?

We cannot be taxed for our own human character flaws, as envy is part of being human.

However if you want to tax someone for envy…then tax those, who outside of their own insecurities, spend their time creating envy!!!

For example: the media, paparazi, advertisers, dodgy business companies that create middle men for every sphere of business and waste our hard earned cash, bad politicians, banks for their usury, the so called ‘level palying field’ of the Global Stock Market for not accepting poor nations so Multi-nationals can purchase their products at a price not fit to live on, Petro-chemical companies who give Food Aid in exchange for oil drilling and cash crops that do not benefit the poor benfactor nations they contribute to, Multi-national-global corporations who make people work to unrealistic targets to boost shareholder earnings at the expense of creating high staff turn over and a transient workforce, and other rich oppressors who make people feel like they should be grateful to be poor because atleast they have a job despite not having enough to live on and pay for medicine etc etc.

All this creates envy out of lack – and these are the people you should tax!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

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