TY  - JOUR
AU  - Zeckhauser,Richard
AU  - Coate,Steve
AU  - Johnson,Stephen
TI  - Robin-Hooding Rents:  Exploiting the Pecuniary Effects of In-Kind Programs
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 4125
PY  - 1992
Y2  - July 1992
UR  - http://www.nber.org/papers/w4125
L1  - http://www.nber.org/papers/w4125.pdf
N1  - Author contact info:
Richard J. Zeckhauser
John F. Kennedy School of Government
Harvard University
79 John F. Kennedy Street
Cambridge, MA  02138
Tel: 617/495-1174
Fax: 617/384-9340
E-Mail: richard_zeckhauser@harvard.edu

Stephen Coate
Department of Economics
Cornell University
Uris Hall
Ithaca, NY 14853-7601
Tel: 607/255-1912
Fax: 215/573-2057
E-Mail: sc163@cornell.edu

Stephen Johnson
E-Mail: sjohnson@rpm-data.com
AB  - 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.
ER  -