Ethan Stone (Iowa) has posted Adhering to the Old Line: Uncovering The History and Political Function of the Unrelated Business Income Tax on SSRN. Here is the abstract:

The paper examines the history of the building pressure during the 1940s the pass the UBIT and finds that the traditional explanations hide an underlying political function. As the charitable exemption became more important with the expansion of the income tax in the 1940s, it attracted new attention from both policymakers and a growing tax-shelter industry. Charities and sympathetic policymakers tried to justify a suddenly important blanket subsidy to charity on the basis of the charities exclusive dedication to good works. Tax-shelter promoters made the effort more difficult by featuring charities in roles, such as buying and leasing commercial real estate and operating businesses, distinctly incompatible with traditional perceptions of charitable activities. The UBIT prevents this cognitive dissonance. It discourages activities that make charities look uncomfortably uncharitable by taxing them, while simultaneously leaving exempt the "old line" of passive investment and business activities related to an exempt purpose.