14 December 2010

Earn the endowment

When a generation receives unearned surplus from a prior generation it becomes incumbent on that freely endowed generation to pass on the surplus to the needy so as to earn the endowment ex-post rather than ex-ante. Indeed, that is what makes market exchange different from gift exchange. Market exchange establishes deservedness on the margin ex-ante whereas gift exchange establishes deservedness ex-post
The question is whether the deservedness needs to happen on the margin or infra-marginally or on the average. 

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