Inequality First, Do No Harm

摘要

Measured inequality has increased in recent decades. However, we have argued that some portion of this increase actually stems from mismeasurement. With respect to what remains, we believe that it is necessary to distinguish socially beneficial or neutral from socially problematic causes of inequality. Attacking what we have called the "bad" inequalities generated by government policy has two major advantages over other strategies for fighting inequality. First, it avoids attacking forms of inequality that are either desirable or neutral and thereby destroying those benefits. Second, the explicit costs of reducing the policy-driven bad forms of inequality are, we believe, far less than trying to reduce inequalities of birth or environment. Admittedly, it is difficult to get the political process to roll back its power even when the fruit hangs low. However, if such interventions are exacerbating inequality while also either harming economic growth or worsening the condition of the least well-off or both, attempting to remove them seems a less-risky and less-damaging way to address inequality than by expanding high-cost policies that are unlikely to work as planned. Those who believe that market economies are to be preferred can both acknowledge the existence of some degree of increasing inequality and argue that some of the causes are policy relevant. Careful examination of the issue of inequality should not force defenders of markets to the sidelines. We have important insights and policy recommendations to offer as ways to reduce problematic forms of growing inequality.