Why America Should Spread The Wealth

Many economists worry that making societies more equal through income redistribution or other means lowers economic growth. This â??big tradeoffâ? between equality and efficiency, which is supported by comparisons of capitalist and socialist countries, implies that there is a limit to how much redistribution a society should pursue. At some point the tradeoff of more equality for less output â?? which worsens as we push toward more and more equality â?? becomes intolerable. However, while the tradeoff is quite unfavorable as we push to extremes, recent experience suggests there is a wide region where the tradeoff is hard to detect. Thus, worries about this tradeoff appear to be overblown.