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Knowledge Base

The Inequality We Should Worry About

How can you distinguish between good and bad inequality?

Good inequality occurs when goods or services benefit consumers without special favors granted by the government. For instance, entrepreneurs’ success increases wealth inequality, but also improves the well-being of tens of millions of people. 

On the other hand, bad inequality occurs when people use government-granted monopolies or special favors to prevent other competition. 

How can the government promote good inequality and limit bad inequality?

It’s important for federal policies to be able to distinguish between good and bad inequality. Ultimately, we need policies that will increase innovation, strengthen the economy, and ultimately give people more of a reason to innovate.