>Sure, but how big the incentives should be is an empirical question in
part.
>Rawls suggests that inequalities of income are justified if they improve
the
>well being of the least well off. Would you consider it a reason to
licence
>greater differentials if experience showed that allowing, say, 100%
>differentials made a significant positive difference to those on the
bottom?
I'm getting into this thread late, so my apologies if I'm rehashing anything.
It seems to me the burden of proof is on the supporters of differential pay to prove that it benefits those on the bottom of the distribution. All other things equal, it is clear that giving more to some individuals leaves less for the rest, thereby making those at the bottom worse off. And this is only in the material dimension. Consider the attendant social phenomena - the added social stature and prestige of those at the top of the income scale comes at the expense of those at the bottom, who will have to deal with being stigmatized as "losers."
I do agree with your premise, that if pay differentials led to a better life for all, then they make sense. But experience leads me to believe just the opposite - that income and wealth inequality exist simply because the powerful take the best of everything for themselves, leaving everyone else with the crumbs. All the talk about efficiency and material well-being is a rationalization to continue the racket.
Brett