Income, Redistribution, Economic efficiency
Choosing the perspective of supply, the current liberal opinion sees in the redistribution process a loss of efficiency. The State handouts (business subsidies, social benefits) and the increasing drain make the natural laws of society degraded, I mean the mechanism of sanction/reward. Choosing the perspective of demand, Keynes considers the reduction of inequalities as a growth factor : the proportion of consumption is lower in high-incomes, any redistribution reducing their shares in the wealth supports the demand and then decreases the savings.The pitfall of the "social" solution is the risk of loss of efficiency resulting from excessive protection of the least dynamic people; the liberal solution is an injustice against left behind. So this raises the question of the existence of a contradiction or complementarity between redistribution and economic efficiency.
In this research paper , I will try to answer to this question. In a first part, I will introduce what redistribution means and will break in the different main redistribution models. Then I will explain in details the two thinking's already introduced at the beginning. At the end I will take for proof the history to explain in reality what happens when a state uses a social redistribution or a "Keynesian" redistribution. And for sure, all along this paper, I will argue whether or not these types of redistribution are an obstacle or a factor of the economic efficiency. France is taken as the main example all along this paper. Some of the references are therefore in French language.
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