Redistributing Wealth

In an axiomatic sense, wealth is always distributed in some way. Likewise, any transfer or exchange of wealth is a redistribution of wealth.

Redistribution of wealth comes in two forms: coercive and voluntary. The former method of redistribution is associated with socialism and, more generally, any statist attempt at transferring the goods or wealth of an individual or group to another individual or group. The latter method of redistribution is associated with capitalism and, more generally, any form of voluntary exchange.

It is obvious, then, that wealth is continuously redistributed. People constantly desire to trade some portion of what they have for something else they desire more. Thus, redistribution of wealth occurs in the free market, and often occurs via the mechanism of exchange. However, there are some instances when wealth is redistributed freely, such as when a parent provides for his child in exchange for nothing. More generally, though, the redistribution of wealth in a free society usually requires exchange.

Therefore, what those who clamor for the redistribution of wealth actually desire is an option to acquire wealth by force in exchange for nothing. They may not be inherently opposed to trade, nor may they be totally desirous of charity—particularly if that charity has behavioral strings attached. Rather, they simply desire to have the option to have wealth redistributed to them without having to offer anything in exchange.

1 comment to Redistributing Wealth

  • Actually, voluntary exchange is not a redistribution of wealth at all. It is a transaction where the wealth or potential wealth of one is traded for that of another. Both sides agree to the transaction because the expect to be better off. Redistribution is the involuntary transfer of the wealth of one person to another person without giving something worth at least as much to the victim of the forced exchange.

    People voluntary engage in charity because they expect to be better off in some way, even if only morally or emotionally.

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