The Principles of Political Economy

Henry Sidgwick

Book III

Chapter VII


§1. In the preceding chapter we have considered the question of governmental interference with a view to a more equitable distribution of produce. I now pass to consider how far such interference is desirable on economic grounds: that is, as was explained in the first chapter of this Book, in order that a greater aggregate of utility or satisfaction may be obtained from the produce of the labour and capital of the community. It may appear that there is no material discrepancy between the practical conclusions to which we are led by reasoning from either point of view: but the lines of reasoning themselves are widely different. So far as we aim at realizing Justice or Equity---according to the interpretation of these notions that has been chiefly discussed in the preceding chapter---the proportionment of the individual's share of produce to his Deserts is the primary end to be sought, and the removal of inequalities only as a means to this that is, only so far as these inequalities are due to other causes than the different worth of the exertions unequally remunerated. Whereas from a purely economic point of view the relation of Desert and Equality is the reverse; a more equal distribution is---subject to certain important qualifications that will be presently stated---more economic: and though the principle of rewarding desert remains, in my view, paramount, it is rather as a stimulus indispensable to the most economic production, which thus presents itself as a condition by which all efforts to make distribution more economic ought to be confined. The distinction is perhaps rather formal than material; but it is necessary to make it clear, in order that the relation of the present to the preceding, chapter may be understood.

The primâ facie ground, then, on which the interference of Government with the distribution of produce that results from the individualistic organization of industry appears economically desirable, lies in the very great inequalities in income to which this organization leads. The common sense of mankind, in considering these inequalities, implicitly adopts, as I conceive, two propositions laid down by Bentham as to the relation of wealth to happiness:---viz. (1) that an increase of wealth is---speaking broadly and generally---productive of an increase of happiness to its possessor; and (2) that the resulting increase of happiness is not simply proportional to the increase of wealth, but stands in a decreasing ratio to it.

The former of these propositions will be thought by many to need no support; considering the vast and varied aggregate of widely felt desires which wealth supplies the means of gratifying. Still it is notorious that it has been roundly denied by a large number of thoughtful persons. Indeed, as was before observed, even the Author of the Wealth of Nations has expressed himself with remarkable decision in the opposite sense. I think, however, that the sentimental optimism which held that happiness is equally distributed between the palace and the cottage---with a preference, if at all, in favour of the cottage---has wellnigh vanished before a more careful and impartial study of the facts of social existence. At the present day, even those who most warmly assail Political Economy on the ground of the exaggerated importance which it attaches to wealth, do not usually go so far as to maintain that increase of wealth is not important for the individual and for society so far as it can be obtained without any sacrifice of other sources of happiness. It is, indeed, probable that there are many rich individuals who would be happier on the whole if they were poorer; and, again, that the immediate effect of a sudden and considerable increase in the wealth of certain sections of the poorer classes might very likely be a diminution of happiness, on account of the increase of pernicious indulgences that it would bring with it. But, making all allowance for such partial or transitory exceptions, it remains true that the practical reasonings of the great mass of mankind---whether for themselves or for others in whom they are individually interested---proceed on the assumption that it is an advantage to be richer; and, further, that the judgment of the most highly cultivated, scrupulously moral and sincerely religious persons---as expressed in their conduct---does not diverge materially from that of the vulgar in the matter. The élite certainly disagree very much with the vulgar as to the real value of particular purchaseable commodities; but they do not practically doubt that additional control over purchaseable commodities generally is an important gain to an individual who obtains it. A man who chose poverty for himself, except for some manifest special and unpurchaseable advantage, or at the manifest call of some special duty, would be deemed eccentric: a man who chose it for his wife and children would be generally thought to deserve a harsher name.

On the other hand few, I conceive, would estimate the advantage of additional wealth so highly as even to dispute the second of Bentham's two propositions above stated, and to contend that on the average the amount of satisfaction derived from wealth tends to increase in simple proportion to the increase of the wealth itself. And from the two propositions taken together the obvious conclusion is that the more any society approximates to equality in the distribution of wealth among its members, the greater on the whole is the aggregate of satisfactions which the society in question derives from the wealth that it possesses.

Reflection, however, shews that this interference is only legitimate under certain conditions: viz. that the total amount of produce to be divided, and the number of persons among whom it is to be divided, remains unaffected by the change in distribution; and further that the change has no tendency to diminish the happiness of the community so far as it is derived from other sources than increase of wealth. These conditions require careful examination; since it will be found that under each of these heads important, if not decisive, considerations may be urged in favour of the existing inequalities of distribution.

[Back to:][PPE, Book III, Chapter 6, Section 6]  Distributive Justice
[Forward to:] [PPE, Book III, Chapter 7, Section 2]  Economic Distribution.
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