Question: Do you agree? Or disagree? Explain your reasoning. There need be no trade-off between equality and efficiency. An efficient economy that yields an income distribution

Do you agree? Or disagree? Explain your reasoning. “There need be no trade-off between equality and efficiency. An ‘efficient’ economy that yields an income distribution that many regard as unfair may cause those with meager incomes to become discouraged and stop trying. So efficiency may be undermined. A fairer distribution of rewards may generate a higher average productive effort on the part of the population, thereby enhancing efficiency. If people think they are playing a fair economic game and this belief causes them to try harder, an economy with an equitable income distribution may be efficient as well.”

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While there is certainly an efficiency wages aspect to a more equal distribution it is hard to imag... View full answer

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