ABSTRACT
Allocation of the national income among citizens has always been a source of conflict, the conflict seems to have intensified in recent years, and this is reflected within the economics profession by a growing interest in the measurement and explanation of the distribution of income. We try to determine whether inequality is increasing over time and to explain observed inequality by social class, education, chance, the life cycle, and so on. However, studies of the income distribution have for the most part been directed away from what I would consider to be the central problem. The principal conflict within Western societies is not about the spread between the incomes of the rich and the poor. It is among people or groups of people to determine who shall be rich and who shall be poor. It is exemplified by the allocation among four people of four slots with fixed incomes of, say, $25,000, $20,000, $15,000 and $10,000, where nobody is initially identifiable as rich or poor and where the four people themselves must decide who is to occupy each slot. Resolution of such conflict need have no impact upon the distribution of income in the statistical sense.
