The Fourth Revenue: Donations

In The Wealth of Nations, Smith categorized all the revenue in a society as falling under three types: Rent, Wages, and Profit, representing revenue from Land, Labour, and Stock, respectively. From this, we derived the three orders of people: the ruling class, working class, and merchant or capitalist class which live by rent, wages, and profits, respectively.

Land > Rent or Taxes (arbitrary regular revenue) > Ruling class

Labour > Wages (voluntary regular revenue) > Working class

Stock > Profits (arbitrary irregular revenue)> Merchant or Capitalist class

 

We connect these three classes to the varnas in Eastern philosophy as below to close the gap between Eastern and Western philosophy since both east and west must exist in a single universe with a single set of laws :

  • Ruling class = Ksattriyas (warriors, leaders, managers)
  • Working class = Shudras (workers, farm-labourers, servants)
  • Merchant class = Vaeshas (merchants, traders)
  • Intellectuals ?

 

However, there is a fourth class called the intellectual class or Brahmins which is composed of scientists, philosophers, priests, writers, etc. Some scientists earn by a fixed wage and some writers earn profits from book sales. But what do we call revenue given to priests and monks? We can’t say they earn by rent nor wages. We can’t really say that the donations they receive are profits because although they are irregular, they are not based on the lack of resources of others. Instead, they are based on the opposite — the abundance of resources of others. Therefore, we can create a definition for this kind of revenue and make it as the fourth kind of revenue forming a fourth order, to completely match it with the four classes of Eastern philosophy.

The Fourth Kind of Revenue = Donations

We define donations as an irregular revenue derived from the abundance of others,  voluntarily obtained. It is derived from goodwill and its earning order is called the intellectual class which gets its revenue from the goodwill of others. Examples of these are research grants and donations for scientific endeavors.

 

With this definition, we can systematize the following revenues into a matrix:

Revenue Matrix - New Page

The complete revenue types and their corresponding orders now become:

Land > Rent or Taxes (arbitrary regular revenue) > Ruling class

Labour > Wages (voluntary regular revenue) > Working class

Stock > Profits (arbitrary irregular revenue)> Merchant or Capitalist class

Goodwill > Donations (voluntary irregular revenue) > Intellectual class

 

 

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