Wealth, income, and inequality / edited by A.B.Atkinson

The readings in this first section deal with different aspects of two fundamental questions: why are we concerned about inequality and what exactly does in equality mean?

These are controversial questions. Some people argue that inequality is not a matter for concern and that intervention by the state to reduce inequality cannot be justified on moral grounds. A recent example is the entitlement theory of justice of Nozick (1974). This approach, which draws on a long tradition, can basically be summarized as asserting that moral judgements must be based on the process by which a distribution is attained rather than on the final distribution itself. It is a theory based on 'historical' rather than 'end-state' principles. The justice of a distribution of income depends, in this view, on how it came about and not on any difference between Messrs. A and B. If we start from a position in which everyone is entitled to the rights and assets which they hold (justice of original holdings), and proceed from it by a series of moves (exchanges, gifts, etc.) which are considered to be just, then the distribution is morally legitimate. The key issue is of course the determination of just initial entitlements, and here the theory is less fully developed.