Due to increasing inequality, something needs to be done urgently. I have written a research post on philanthropy whether it can be a tool to reduce inequality or not and how. Here is excerpt:

Philanthropy is now considered as donation or charity work. But donation or philanthropy is a synonymous of tax exemption and tool for business expansion.Cases show that:

‘‘Between 2001 and 2011, the number of nonprofit sector increased 25 percent. Their growth rate now exceeds that of both the business and government sectors. It’s a massive business, with approximately $316 billion given away in 2012 in the United States alone’’. According to Charity Navigator in the USA, Americans donate $298.42 billion in 2011 (about 2% of GDP).The majority of donations were from individuals (73%), then from bequests (about 12%), foundations (1.8%) and less than 1% from corporations.’’ But on the contrary inequality is increasing inequality

If private sector is earning by using limited public resources then they need to invest in welfare as well, not only for their business motive. Beside tax certain per cent of profit must go to compulsory welfare fund (CWF).

According to a Oxfam’s recent study, the 85 richest people in the world have accumulated the same wealth as the bottom 3.5 billion. One in eight people go to bed hungry every night, while 1.4 billion adults are overweight. Top CEOs were remarkably successful in maintaining their high pay. The ratio between earnings of a CEO and a worker is 243 to 1 as of 2010.

Richest and poorest today are the output of globalization. Much of the inequality that exists today is a result of government policy, both what the government does and what it doesn’t do (Stiglitz 2012). Charity is a fashion of elite society. Philanthropy has been treated as a source of ‘tax exemption’ rather than reducing inequality. Stanford professor Rob Reich wrote that ‘‘without significant progress in easing disparity, philanthropy will have a very hard time continuing to justify its tax- privileged’’. Today, incorporating philanthropy in business is  developing a strategy cover values of the organization and exemption of taxation. If private sector is earning by using limited public resources then they need to invest in welfare as well, not only for their business motive. Beside tax certain per cent of profit must go to compulsory welfare fund (CWF). Adam smith says ‘‘It is not very unreasonable that the rich should contribute to the public expenses, not only in proportion in their revenue, but something more than in that proportion’’ The contribution to the society will help to increase purchasing power of low income consumer. Increasing purchasing power means consumer society can play effective role in the market too.

The number of nonprofit sector increased 25 percent. Their growth rate now exceeds that of both the business and government sectors. It’s a massive business, with approximately $316 billion given away in 2012 in the United States alone

Private sector’s role of welfare, as explained in the research article, is a basic set of philanthropy that must be above of personal charity and tax exemption. Due to strong productive welfare policy, low income group of the society move up gradually. In this article Philanthropy for an equitable society have been made how philanthropy can be a measure to reduce inequality.

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