Wednesday, June 20, 2007

Do People Take Satisfaction in Being Taxed?

I can almost hear the brains of supply-siders grinding to a halt. This story in the New York Times must have driven them crazy:
The University of Oregon announced a new piece of research last week with a startling headline: “Paying taxes, according to the brain, can bring satisfaction.”
Researchers monitored brain activity of subjects as they handed over a portion of money given them as taxes to support a food bank. They found that pleasure centers were activated when they handed over their money to benefit others, even when the money was taxed and not donated.
The experiment has more to do with the psychology of altruism than with tax policy, but it is instructive. It goes to the heart of the notion of the rational actor in classical economics who invariably maximizes utility.
Utility in economics is the measure of personal satisfaction or gratification. The idea that a person might cheerfully hand over money that could make create personal gratification to the government might seem counterintuitive. But humans are not utility maximizing automatons; instead we are emotionally complex creatures who sometimes take satisfaction in actions that benefit others.
I can attest to this effect; I actually derive a small bit of satisfaction from completing my tax return and knowing I’ve done my civic duty for the year. For that matter, I feel better when I’ve taken out the trash (not that it's fun), or better, when I’ve put half of my household waste in the recycling bin.
As a citizen I can take satisfaction or pleasure in public goods created through taxation: necessities such as streets and sewers and amenities such as parks, museums and public concerts. Hardcore believers in maximizing personal utility might object to taxes going to an event like the Clifford Brown Jazz Festival, going on this week in Rodney Square, saying that I would be better off keeping the pocket change in taxes that represents my contribution to the event and using it buy a ticket to a musical event of my choosing. You could say the same thing about the Smithsonian Institution or Yellowstone National Park.
But as a citizen, I take pride in these amenities as representing the city and nation to which I belong. It may not be rational in the strictest sense, but it seems I’m wired that way.


Anonymous Anonymous said...

That doesn't surprise me at all.
Altruism etc are complex functions of a complex physiology geared for the greater good.
We are hard-wired to help each other.

12:30 AM, June 21, 2007  

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