Why Incomes are Unequal

Radio Record, Volume II, Issue 44, 17 May 1929, Page 4

Why Incomes are Unequal

Another. W.E.A. Lecture aod ‘PHE next series of lectures arranged by the Dunedin branch of the Workers’ Educational Association, and delivered from Station 4YA, will begin on Tuesday, May 21, at 7.30 p.m., when Dr. Fisher, Professor of Hconomics at the Otago University, will speak on, "Why Incomes are Unequal." Among the inhabitants of .: besieged city, or a group of shipwrecked mavyiners on a not too desert island, Ji would soon be agreed that the only sensible plan for husbanding the limited supplies of food and other necessaries that were available would be to ration them as accurately as possible according to the varying needs of the members of the group. This was indeed roughly the plan which was adopted in Bngland and other European eountries to meet the real or threatened food shortages of the war period. it did not always work smoothly, but the idea behind the plan was clear and sensible enough. When we are no longer at war, when we have been rescued from our desert island, or when the siege of the city has been raised, we usually give up the idea of rationing, or of distribution according to needs. The plan involves a great deal of difficult calculation, and interferes with our natural desire to decide for ourselves what we are going to buy; in normal times therefore we distribute our national income on principles quite different from those which have been suggested. Perhaps the most striking consequence of the adoption of these principles is the market inequality of income. It is highly important that we should understand the causes of this inequality, the results, both good and bad, which flow from it, and the connections which exist between inequality and the social and political prob’; of our day, for if we agree as most thoughtful people do that we would on the whole be better off if the national income were distributed rather less. unequally than it is we shall have a better chance, if we understand the causes of inequality, of reaching our objective without inflicting upon ourselves more serious damage than we are attempting to remove. . Economists of every shade of thought have nearly all been agreed that it would be a good thing if wealth were distributed less unequally than it is. Even Robert Malthus, who is famous for his gloomy views about the pressure of population growth, and many of whose opinions would to-day be regarded as hopelessly reactionary, declared in 1798 that "the present great inequality of property must certainly be considered as an evil, and every institution that promotes it is essentially b-cnovsrasmnsusnnives Sams cbusipumesingasandannsneainiimsamees

bad and impolitic," though he doubt whether governments could actively in terfere with adv. tage. Marshall, the most influential DPnglis. writer on economics in recent years, and whose work was characterised by an almost excessive caution, said that "the drift of economic science during many generations has been with increasing force towards the belief that there is no real necessity, and therefore no moral justification, for extreme poverty side by side with great wealth." But until fairly recently there have not been many satisfactory attempts to work out a theory of inequality of income as a whole. The best general explanation is to be found in Hdwin Cannan’s "Wealth," ‘especially chapters XI and XII. A more elaborate and useful study is "The Inequality of ncomes," by Hugh Dalton, once on the staff of the .London School of Economics, and now representative of a London \constituency in the House of Gommions. The most persuasive accour?®’ @ the evils which flow from inequality is to be found in Bernard Shaw’s "Intelligent Woman’s Guide to Socialism and Capitalism." ee te taeetenepeermannines-trasaeecepesdiaerataninanessateanbetamepseeeuthgrenaeatiet