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From: mvs@meccts.UUCP (Michael V. Stein)
Newsgroups: net.politics.theory
Subject: Re: Redistribution of income and wealth
Message-ID: <227@meccts.UUCP>
Date: Fri, 20-Sep-85 12:34:57 EDT
Article-I.D.: meccts.227
Posted: Fri Sep 20 12:34:57 1985
Date-Received: Mon, 30-Sep-85 01:02:51 EDT
References: <186@gargoyle.UUCP>
Reply-To: mvs@meccts.UUCP (Michael V. Stein)
Organization: MECC Technical Services, St.Paul, MN
Lines: 34
Summary: 

In article <186@gargoyle.UUCP> carnes@gargoyle.UUCP (Richard Carnes) writes:

>
>The following is from A. C. Pigou, *The Economics of Welfare*, 4th ed.
>(London: Macmillan, 1948; originally published 1932), p. 89.
>
>	It is evident that any transference of income from a
>	relatively rich man to a relatively poor man of similar
>	temperament, since it enables more intense wants to be
>	satisfied at the expense of less intense wants, must
>	increase the aggregate sum of satisfactions.

I am not surprised that the quote is from a book published in
1932.  Later research in economics has thoroughly shown that individual
indifference curves are not comparable between different individuals.
Therefore the additional happiness from an extra dollar of income
(marginal utility) is different for every individual.  This argument
thus cannot be used as a defense of income redistribution.  (The
belief that utility could be measured and used for policy making
is pretty much a hold over from such groups as the utilitarians.)

As David McCloskey writes in "The Applied Theory of Price",
published in 1982.

	The case for progressive taxation must rest directly on a
	moral premise that more equality of income is desirable, not
	indirectly on a psuedo scientific comparison of happiness.

-- 

Michael V. Stein
Minnesota Educational Computing Corporation - Technical Services

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