What do economists say about inequality?
I&#x27;m no big fan of Laffer curve - and especially the stupid way it was used to justify the position that lower taxes are the right answer to every problem - but using a similar approach with inequality could help.<p>With total inequality, everybody starves and dies except the few mega-rich, and not even the mega-rich would be happy as nobody would be able to produce the luxury things they enjoy spending their riches on.<p>With total equality, productivity and innovation plummet, because most of those who are able and willing to work more and&#x2F;or better resent the freeloaders that enjoy what the actual producers produce without putting in the effort, and become demotivated.<p>So, obviously, <i>some</i> inequality is good for society, but <i>too much</i> inequality is bad. Western societies have been moving towards higher and higher inequality in the last 30 years - incidentally, also thanks to the Laffer curve.<p>At some point, too much inequality is bad not just for &quot;social justice&quot;, but also for business. Have we already passed that point? If so, shouldn&#x27;t we do something to stop the trend? And what?<p>What PG is maybe missing is that startups aren&#x27;t the main engine for creating inequality, but excessive inequality is going to create problems, and we can&#x27;t just ignore those problems because a policy to limit those problems could also limit the number of unicorns created in SV.