Free market economies foster discipline by rewarding the successful and penalizing failures. They inevitably create an economic hierarchy by producing a select few of wealthy individuals, a large middle class, and an even larger lower class. Individuals are free to move between classes based on their ability to satiate the desires of others. Only by freezing individual incomes at some moment in time are we able to consider class distinctions. Having established these clear-cut classes, one is then able to see that some have more relative to others. That is, they are unequal. Individuals differ in many ways, including energy, ambition, and ingenuity. As a result, in a market-oriented economy some people will be better than others at satisfying consumers and will tend to make more money. That is, assuming that all individuals are equal before the law, all are free to compete for any and all social positions as they wish.
• How Incentives Play into Inequality
It’s due to incentives to produce the best products. To be rich or earn an income, he or she must produce and sell something that people judge to be worth buying. “The important economic effect of income inequality pertains to the ability and incentive to produce… Income inequality provides a greater ability and incentive to produce wealth.” Trade is voluntary so it must be that people are willing to purchase from a supplier who has outperformed their competitors.
• Rich People’s Contributions: Bill Gates and Sam Walton
As Bill Gates grows richer, other individuals benefit because they are able to obtain better computer software. In a society where men interact based on voluntary trade, a person grows rich by producing goods and getting people to pu...
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...r that former workers would desecrate it. The reverence or at least quiet sympathy that popular culture extends to the very rich. If it were the case that the rich had grown richer at the expense of the poor, thereby making them poorer, then we would have reason to be concerned. That isn’t the case, because they have earned their wealth. The needs of the poor have nothing to do with the earnings of the rich. People like Bill Gates and Warren Buffett can make as much money as they want, but, so long as they earned their money honestly, what do their earnings have to do with the quality of life for the rest of us? He was ' 'a detail-oriented owner, ' ' a ' 'workaholic who painstakingly consolidated dying railroads, transformed them into highly profitable megalines. ' ' Indeed, ' 'the case for Gould as an exemplary, successful, long-term C.E.O. is there to be made”.
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