Income Distribution

In my opinion, income should not be distributed equally because most people included the economists agree that a certain level of unequally distributed income would help to create incentives. One of the 6 key ideas in economic way of thinking is that people respond to incentives. According to Mankiw (2001) because people make decisions by comparing costs and benefits, their behavior may change when the costs or benefits change (pg. 7). When the benefit of working hard reduce people would respond to it by decreasing their efforts and contribution. So it is clear that the equally distributed income would destroy people’s motivation for working and contributing to the workplace because no matter how well they did their job, how many hours they spent on working or what kind of contribution they made to society they still earn the same as those did nothing. Therefore, people who used to work hard and actively e contribute to society would stop working as their efforts are not recognized and those who did not work receive well paid salary and continue to work as before. Then the economy would fall into recession and could not grow. It is undeniable that the difference in income level will encourage people to put more efforts on their job and contribute more to try to get a better salary level. At least this principle is true for most of population who are at low middle and lower high income. For those who are at 5% highest level of income they are more likely to work not because of money but their interests or self-actualization

It is true that the low-income families do not have the equal opportunities as they do not have the financial resources to invest in the education and health of their children which would be profitable in the future. However, instead of the equal distribution of income policy the anti-poverty policies can provide better equal opportunities and also increase the nation’s total income without the expense of losing incentive. Raising income of poor families do not depend on the equal distribution of income. According to Grennes and Strazds (2014) recently, economic reform in China since 1977 has moved millions of Chinese out of poverty without major redistribution of income away from other groups of Chinese. Therefore, equal opportunities are important but it is not the same as equal income. The focus only on the result, not the causation might lead to counterproductive policy. For example, China under the Mao Tse Tung has the policy that is intended to produce greater equally income distribution but that resulted in lowered total income and made most of the population worst off than they would have been (Grennes & Strazds, 2014)

in addition to this, the equal income distribution is unfair in spite of having the term equally. Income should be distributed based on knowledge and skills of workers and their contribution to workplace not on other factors. To raise income a person need the