19 February 2008

Govt Role to Decrease Inequality: But What Kind?

Countries should have preferences over Information Equality (there exists moral hazard implications with more pointed goals).

With income equality, agents can procure what they want, including health if that is what they want. Therefore wealth redistribution is a more general goal, and health redistribution is more pointed goal. There is less moral hazard associated with more pointed redistribution goals. With income redistribution there is distortion in labor supply and savings decisions including investments in health. With health redistribution there is still moral hazard, but less. For purchase of commodities, agents must still work accordingly, however there is still lack of incentive for adequate personal investment in health.

I claim that the optimal commodity of redistribution by the government is information. Access to information contains all the answers agents could ever want to achieve any goals they would have. It provides the keys to vast warehouse of tools to serve the needs of all individuals desiring to cultivate their own potential. Achieving information equality consists of procurement of library services for public use, subsidies and at least mild de-tiering of internet, subsidies of information databasing firms, hiring of services to assist the access to information such as librarians and search cost routines.

1 comment:

Nolan said...

Can you give an example of a more pointed, though morally hazardous, goal that is a subset of information equality?