NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Robin-Hooding Rents: Exploiting the Pecuniary Effects of In-Kind Programs

Richard Zeckhauser, Steve Coate, Stephen Johnson

NBER Working Paper No. 4125
Issued in July 1992
NBER Program(s):      PE

The pecuniary effects of cash and in-kind programs differ. A program that builds housing for the poor, for example, is likely to result in a lower price of existing low-income housing than would an equally costly cash transfer program. Low-income renters in general would benefit; landlords would lose. The process we label Robin-Hooding rents employs in-kind programs to transfer rents from one group in society to another, Direct taxation of "donor" groups may be infeasible because their incomes can't be monitored, they are engaged in illegal activities, they are foreign, or the government's administrative apparatus is ineffective. A general equilibrium analysis reveals that absent the ability to target taxation, Robin-Hooding may be a valuable second-best transfer instrument. Robin-Hooding also has drawbacks, Its incentive effects are significant, for today's rents flow from yesterday's investment activities. Moreover, even when Robin-Hooding is undesirable, parochial government agencies may be tempted to employ it as a means to escape the scrutiny of the budget process. The real world use of Robin-Hooding in both developed and developing nations is discussed.

download in pdf format
   (1762 K)

email paper

This paper is available as PDF (1762 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w4125

 
Publications
Activities
Meetings
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us