CHAPTER VII.. Distribution of National Income.

DISTRIBUTION OF NATIONAL INCOME.

SECTION CCIII.

EFFECT OF AN EQUAL DIVISION OF THE NATIONAL INCOME.

The best distribution of the national income among a people is that which enables them to enjoy the greatest amount and variety of real goods, and permanently to produce real goods in an increasing quantity and variety.

If the income of a people were divided equally among all, each one would indeed, be, to a very great extent, independent of all others. But then, no one would care to devote himself to the coarser and less agreeable occupations, and these would be either entirely neglected, or people would have to take turns in engaging in them.[203-1] (§ 9.) And thus would disappear one of the chief advantages of the division of labor, viz: that the higher orders of talent are devoted to the higher orders of labor. Besides, it is very doubtful, whether, under such circumstances, there would still be any solvent (zahlungsfähige) demand for the achievements of art.

Nor would the saving of capital prosper, where such equality prevailed. Most men consider the average outlay of their equals as an unavoidable want, and save only to the extent that they possess more than others of their class. If, therefore, every one had an equal income, no one would consider himself in a condition to save.[203-2] The same consideration would deter most men from every economic venture, and yet no great progress is possible where no venture is made.[203-3] [203-4]