Is income inequality bad for a society?

[John_Mace]

@Buck_Godot

In terms of maximizing use of resources, there is much in favor of reducing economic disparity. The marginal utility of a dollar is much greater for a poor person than for a rich person. So to maximize the over all marginal utility of the available resources one should have the wealth rate as flat as possible.

The problem of course is that you also need to motivate people to actually produce or else there won’t be any resources produced to distribute, so there is sort of a Laffer curve type effect where some middle ground is best but no one will agree where that is.

From my point of view the inequality should be the least that is required to motivate people to work. So that a CEO’s salary should be the lowest salary that will still make being a CEO a desirable position to a well qualified candidate. I suspect that this number is much lower than its current rate.

Well, all we have to do is determine what that amount is (for the CEO) and we’re set. Piece of cake, right?