ABSTRACT
What is the just wage? This chapter answers that long-standing and salient question. To wit, we ought to remunerate people in proportion to their meritorious contributions to the economy. Unfortunately, actual economies often fail to recognize merit and contribution, and are to that extent unjust. They are also inefficient, allowing people to become rich through nepotism, irrelevant facts like beauty, and because of failures of competition. The chapter explores how these undeserved economic rents may be eliminated. The pattern of income distribution in a meritocracy is then described. Meritocratic income distribution has a number of alluring features: It cultivates an ethos of personal responsibility; it maximizes positive liberty; and it solves puzzles afflicting libertarian theory. In addition, meritocracy answers questions about how preference formation in citizens can best be handled. Finally, the chapter defends a limited social safety net, protecting those who cannot participate in economic life and the deserving poor.
