Quotation of the Day…

by Don Boudreaux on July 17, 2018

in Inequality, Myths and Fallacies

… is from page 4 of Alan Reynolds’s excellent 2006 book, Income and Wealth (original emphasis):

The two young founders of Google, Larry Page and Sergey Brin, quickly made something like $12 billion each by greatly facilitating our information, education, and shopping efficiency. Why should anyone care how much money the founders of Google, Apple, or Microsoft made? Some might object that they earned a larger share of income, but in what sense can we regard their income as shared? Google is something new – without Google there could be no income from Google. The Google founders have their income and you have yours. What they earn has nothing to do with how much or how little you can earn, except that their invention may help you earn more (personally, I feel as though I owe them a really big check).

DBx: Indeed so.

People who obsess over differences in monetary incomes – people who leap from observing large differences in monetary incomes to the conclusion that something is thereby amiss and requires ‘correction’ (always by giving a relatively small handful of people an enormously unequal share of power over others) – typically operate with the mistaken presumption that the amount of material wealth in the world is fixed. The very same mistaken presumption is at the core of most arguments against free trade. Neither the redistributionist nor the protectionist understands economic processes or economic growth.

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