00:01
Should a nation's income be distributed to its members according to their contributions to the production of that total income or according to the members ' needs? should society attempt to equalize income or economic opportunities? are the issues of equity and equality in the distribution of income synonymous? to what degree, if any, is income inequality equitable? the basic argument for an equal distribution of income is that income equality maximizes total consumer satisfaction for any particular level of output and income.
00:36
Though the logic of argument for equality sounds good, the credits attack its fundamental assumption that there is some fixed amount of output produced and therefore income to be distributed.
00:47
Credits of income equality argue that the way in which income is distributed is an important determinant of the amount of output or income that is produced and available for distribution.
01:00
Income equity refers to how fairly income is distributed.
01:04
Income equality can be achieved through redistribution of income, which comes at the opportunity cost of reduced production and income.
01:14
Greater production and income through reduced redistribution comes at the expense of less equality of income.
01:21
Some inequality of distribution of income is necessary, not only for efficiency, but also for those who produce more and deserve to be rewarded for their efforts.
01:32
When tax revenues are equally distributed, the economic incentives to get ahead will be removed greatly, reducing society's total production and income.
01:44
The way income is distributed affects the size of that income...