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Rights and markets.
“We hold these truths to be self-evident that all men are created equal, that they are endowed by their Creator with certain unalienable Rights that among these are Life, Liberty and the pursuit of Happiness.”
Thomas Jefferson, 1776.
a) Give examples of how we recognize people as having rights to Life, to Liberty, and to the pursuit of Happiness. Give examples of how we do not recognize people as having these rights but make them conditional on success in the marketplace.
b) Does your answer mean that we, as a nation, are insincere in our commitment to democracy and equality? How does Arthur Okun resolve this seeming contradiction?
c) Evaluate the evidence relating income inequality and efficiency. Is Okun right? Consider the arguments in Chris Tilly, “Geese, Golden Eggs, and Traps” (article 7.1 in Real World Micro), and Gar Alperovitz and Lew Daly, “The Undeserving Rich” (1.6): do we need inequality to maintain an efficient economy?
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