An Introduction

Welcome to my thought space.

I decided to start this blog because of  an interest in Economics.

Economics is a social science and in its narrowest definition can be seen as a study of ‘what is’ and ‘what has been’ (though that may be used for the purpose of forecasting and attempts to influence the future). It is a study of how we share resources, some may argue that there is no need to share, that they wish to keep what they have as it is a result of their hard labour. I would dispute this simplistic view.

Let me use Adam and Eve as an example, if God placed Adam on earth and gave him a garden to work and watch over, Adam can not claim that all that he gains is simply as a result of his hard labour after all he was given the resources of the Earth and the garden to work on. Similarly those who by accident of birth were born into families with greater than average wealth, education and status and who therefore benefit from those advantages through access to a better diet, a more enlightened view of the benefits of education, help in establishing homes and businesses and access to an exclusive network of the elite in politics, society business and the media cannot claim that they are entitled to greater remuneration or wealth simply due to their own efforts. That is not to say that those who work hard should not be better rewarded than those who do not, all other things being equal.

This is a normative argument which perhaps could be described as moral philosophy, a discipline that Adam Smith is noted for. In contrast to those who promulgate the view that Smith was a proponent of ethical egoism, Noam Chomsky has argued  that several aspects of Smith’s thought have been misrepresented and falsified by contemporary ideology, including Smith’s reasons for supporting markets and Smith’s views on corporations. Chomsky argues that Smith supported markets in the belief that they would lead to equality, and that Smith opposed wage labor and corporations. Economic historians such as Jacob Viner regard Smith as a strong advocate of free markets and limited government (what Smith called “natural liberty”) but not as a dogmatic supporter of laissez-faire.(

The Wealth of Nations includes the following statement on the payment of taxes:

“The subjects of every state ought to contribute towards the support of the government, as nearly as possible, in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the state.”
Moreover, in this passage Smith goes on to specify progressive, not flat, taxation:

“The rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion”

Smith even specifically named taxes that he thought should be required by the state among them luxury goods taxes and tax on rent. He believed that tax laws should be as transparent as possible and that each individual should pay a “certain amount, and not arbitrary,” in addition to paying this tax at the time “most likely to be convenient for the contributor to pay it”. Smith goes on to state that:

“Every tax, however, is, to the person who pays it, a badge, not of slavery, but of liberty.”


I would therefore propose that equality is a good thing, not the kind of equality used by those on the right wing to promote their own self interest at the expense of others nor the kind of equality proposed by those on the left who favour  an all powerful state (which is simply another form of inequality). My position is most accurately represented by the views of Rawls and Krugman as illuminated in Wikipedia as follows – “Philosopher John Rawls, in his A Theory of Justice (1971), developed a “second principle of justice” that economic and social inequalities can only be justified if they benefit the most disadvantaged members of society. Further, Rawls claims that all economically and socially privileged positions must be open to all people equally. Rawls argues that the inequality between a doctor’s salary and a grocery clerk’s is only acceptable if this is the only way to encourage the training of sufficient numbers of doctors, preventing an unacceptable decline in the availability of medical care (which would therefore disadvantage everyone). Analyst Paul Krugman writing in The New York Times agreed with Rawls’ position in which both equality of opportunity and equality of outcome were linked, and suggested that “we should try to create the society each of us would want if we didn’t know in advance who we’d be. “Krugman favored a society in which hard-working and talented people can get rewarded for their efforts but in which there was a “social safety net” created by taxes to help the less fortunate.” (

In fact there is good evidence that inequality is bad for everyone in society, both the rich and the poor. Evidence which is supported by the work of  Richard Wilkinson and Kate Picket in their book The Spirit Level.

I hope you enjoy these musings and gain from them whether or not you agree with them.


About Of Men and Markets

A student of politics and economics View all posts by Of Men and Markets

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