Tuesday, February 15, 2005

The Honest Indigent

I'm not sure what we want to do with this information, but it certainly corroborates my previous post.

Two issues are brought to the forefront:

1. Is it more efficient to transfer cash or goods in-kind to the homeless? Presumably this guy will trade in whatever he is given at whatever the discount, for beer, thereby reducing the initial value of an in-kind transfer.

2. Should the philanthropist necessarily get to define the choice set of the gift regardless of the recipient's preferences? In other words, is there a place for paternalism here? Does father know best?

Confession: I did give him money. I am not categorically against giving money to people who ask for it on the street. In this case, however, I felt like I owed him something for the picture.

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