> Neoclassical economics preaches that all is fair with the distribution of income. Income differences, the theory claims, stem from differences in productivity

> Neoclassical economics preaches that all is fair with the distribution of income. Income differences, the theory claims, stem from differences in productivity. As long as markets are competitive, people earn their ‘marginal product’. And so there’s no reason to redistribute income. Oh man. No economist says this. The fundamental theorem of welfare economics only says that the income distribution will be pareto optimal. (And that’s assuming perfect information, competitive markets, no externalities, etc.) Pareto optimal means there’s no way to redistribute resources so that that everyone prefers the new distribution or is indifferent. But redistribution as it’s usually proposed is not attempting to make everyone better off, it’s trying to make the poor better off by transferring money from the rich to the poor. The assumption being that the poor benefit more from the transfer than the rich are harmed. As an example, I would barely notice if you deleted $50 from my bank account, but giving $50 to a homeless person might let them sleep in a hotel for a night instead of on the street. So a redistribution of $50 from me to a homeless person clearly benefits them much more than it harms me. But people love to make up some insane belief that’s obviously wrong and then attribute it to economists. Another fun one you see often is “Economists assume everyone is perfectly rational, but look at me! I’ve never read a single book on economics and I’m assuming the whole field relies on a single, obviously false premise!” I’m not really sure where this impulse comes from. I would much prefer people attribute some things to economists that they actually believe, like “immigrants are good for a country and the people in it” or “we should tax carbon emissions and tariff countries that don’t” or “we should pay people who get vaccinated against contagious disease” or “we need taxes to solve coordination problems when funding public goods like roads and defense” or “the mortgage interest deduction is distortionary and regressive and needs to go”. Wouldn’t that be more interesting than endless articles debunking universally-held economist opinions like “everyone gets paid exactly for their merit and how rich your parents are has no effect on how rich you will be”?