From: hgm@waikato.ac.nz
Newsgroups: sci.econ
Subject: Re: distribution of wealth
Date: 9 Apr 92 01:08:58 +1200
Organization: University of Waikato, Hamilton, New Zealand

In article <1992Apr7.050800.17025@augean.eleceng.adelaide.edu.AU>, 
dabbott@augean.eleceng.adelaide.edu.AU (Derek Abbott) writes:

> If we added up everybody's bank balances and cash-on-hand, in the world,
> and divided by the world population what would each of us get?
> 
> What does this result mean?

Absolutely nothing, since those who 'own' the natural resources will set the
price of these resources and their products without which the rest of us cannot
survive so in no time we will be back to massive inequality and wage slavery.

> 
> If we include assets into the calculation, what happens?

If 'assets' includes all natural resources of economic value as well as
whatever boats and buildings etc. may be around we would have a good place to
start.

All we would need then would be a few rules about the rights of future
generations and limitations on the legality of contracts and we might be on the
way to a pareto optimal and equitable society.

Since people are being born and dying all the time, the rights to natural
resources given at this great redistribution cannot be 'transferrable ownership
rights for perpetuity'. Each person should have the 'right to use' a share of
each natural resource. The actual amount each share represents should be
adjusted as often as it is practical to estimate global population. The right
to this flexible share should be non-transferable. Every person has one and
no-one can have more than one. People should however be free to lease their
share. A slightly lesser form of ownership of particular resources would still
exist. Each resource owner would be required to lease the number of 'right to
use' shares currently represented by the amount of resource owned. Provided
they are prepared to pay the going rate for leasing these rights 'owners' would
have first option to lease. 'Owners' could thus bequeath or sell their option
with the improvements which would be the products of their labour or paid for
by them.

In this way people who did not have the skills to use resources could recieve
appropriate income from their right to them. Without some restriction on their
right to sell and some mechanism for them to profit from the right without
selling it we would quickly return to inequality.

A limit on the length of contracts to lease would probably be desirable to
maintain flexibility. We all know the supposed adverse effects of sticky
prices!

This system would allow the market to distribute much more evenly as assets
would remain more evenly distributed. Assets which were the combination of
labour with natural resources could still acquire added value so would 
still attract more rewards from the market and enable people to acquire more
valuable products of other people's labour so there would still be incentives
to work. 

There would still be property rights in natural resources so the market would
create incentives not to use them wastefully. 

The values of the market would be the values of all the people not only those
of the lucky and those whose skills the lucky want to hire. Women and children
would have far greater economic power and I believe that would lead to 'Pay
Equity' without any complicated regulations. Many people might be sadly
disappointed in the value their labour had in this new equitable market.

Helen Marsh