Equality and Economic Efficiency: Is There a Trade – off? 1

Economic inequality tends to undermine equality in other spheres. Economists are aware of this regrettable tendency, but they commonly assume that if the goal of economic equality were to be pursued, economic inefficiency would result. As Okun (1975, p. 48) stated, "Any insistence on carving the pie into equal slices would shrink the pie. That fact poses the trade-off between economic equality and efficiency."