Thursday, March 09, 2006

Generosity and Spite: A Linear Programming Problem

As an ideal, equality has little appeal for me. I’m not morally offended if some people are better off than others, at least if everyone can live decently. I don’t doubt that measures that artificially level wealth tend to result in lower or negative growth rates since it is the prospect of doing better than the others that fuels effort and enterprise. Insisting on equality of outcome amounts to adding an expensive constraint to the problem of maximizing the performance of an economy. The point is often missed, however, that an ideological insistence on a high level of inequality is just as artificial and perhaps just as likely to lower the overall outcome. In this connection, I note that the wealthiest Americans are currently rich beyond all measure, but the economy isn’t performing very well. With this much inequality, everybody–not just the contemporary Croesuses–should be rich as Croesus.

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