IDEAS home Printed from https://ideas.repec.org/h/spr/advchp/978-4-431-54535-4_9.html
   My bibliography  Save this book chapter

Optimal Income Distribution

In: Elements of Neo-Walrasian Economics

Author

Listed:
  • Takashi Negishi

    (The Japan Academy
    The University of Tokyo)

Abstract

In the previous chapter, it was shown that there are many cases in which competitive markets fail to allocate resources optimally. Even if we disregard the existence of such difficulties, however, what competitive markets can do is only to achieve a Pareto optimal allocation, which may not be the optimal organization of an economy, since Pareto optimality is, though necessary, by no means sufficient for it. To choose the optimal organization of the economy from many Pareto optimal allocations is the problem of the optimal distribution of incomes, in view of the second half of the fundamental theorem of welfare economics, which insists that any Pareto optimal allocation can be achieved through perfect competition if incomes are properly distributed among consumers (Sect. 7.8). Since different individuals have different opinions on how should incomes be distributed, and the market mechanism cannot be relied on to solve it, the problem of optimal income distribution is a social choice which has to be made politically through voting in a democratic society.

Suggested Citation

  • Takashi Negishi, 2014. "Optimal Income Distribution," Advances in Japanese Business and Economics, in: Elements of Neo-Walrasian Economics, edition 127, chapter 0, pages 147-165, Springer.
    • Handle: RePEc:spr:advchp:978-4-431-54535-4_9
    DOI: 10.1007/978-4-431-54535-4_9
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:advchp:978-4-431-54535-4_9. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.