Thursday, January 12, 2006

What Economics Finds About Redistribution

Russell Roberts mentions a work by Robert Lucas, a nobel economist, and writes:
"In America, at least, many people feel that the improvement in the well-being of the poor comes from government programs that protect the poor from greedy businesses. Without such protections, the dog-eat-dog world of ruthless capitalism would grind the poor to dust."
He then quotes Lucas:

"But of the vast increase in the well-being of hundreds of millions of people that has occurred in the 200-year course of the industrial revolution to date, virtually none of it can be attributed to the direct redistribution of resources from rich to poor."
This seems so very important, yet this message seems to seldom, if ever, be picked up by our political leaders.

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