Some people say we have this inequality because some people have been contributing much more to our society, and so it's fair that they get more. But then you look at the people who are at the top, and you realize they're not the people who have transformed our economy, our society.
Interpretation
The quote challenges the notion that economic inequality is justified by individual contributions to society.
In this quote, Joseph Stiglitz critiques the prevailing belief that those who earn the most have contributed significantly more to society than others. He argues that many individuals at the top of the economic ladder have not necessarily transformed society or the economy, suggesting that their wealth is not always a reflection of merit or contribution, but rather a result of systemic inequality.
In practice
During a debate on economic policies, this quote can be used to argue against the meritocracy narrative.
Free migration within Europe means that countries that have done a better job at reducing unemployment will predictably end up with more than their fair share of refugees. Workers in these countries bear the cost in depressed wages and higher unemployment, while employers benefit from cheaper labor.
I don't think we can have democracies that work where most of the people are not benefiting economically, where most of the people are worried about their job security.
Let me put it very forcefully: No large economy has ever recovered from an economic downturn through austerity. It's not going to happen in the United States, and it's not going to happen in Europe.
What separates developing countries from developed countries is as much a gap in knowledge as a gap in resources.
One of the arguments I make for the failure of the euro is that, at the time it was being constructed, there was a 'neo-liberal' ideology which said that all we need to do to make this thing work is to get deficits low, keep inflation low, and take down barriers, and then everything would be fine.
Trump sees the world in terms of a zero-sum game. In reality, globalisation, if well managed, is a positive-sum force: America gains if its friends and allies - whether Australia, the E.U., or Mexico - are stronger. But Trump's approach threatens to turn it into a negative-sum game: America will lose, too.
If you're totally illiterate and living on one dollar a day, the benefits of globalization never come to you.
Good economic theory must give the people the chance to use their talents to build their own lives. We must get away from the traditional route where the rich will do the business and the poor will depend on private or public charity.
I truly believe that capitalism was created to help people live better lives, but sadly over the years it has lost its way a bit. The short-term focus on profit has driven most businesses to forget about the important long-term role they have in taking care of people and the planet.
That's the world we live in: when it comes to economics, people have emotions; it's not like chemistry or physics.
I don't know where the stock market is going, but I will say this, that if it continues higher, this will do more to stimulate the economy than anything we've been talking about today or anything anybody else was talking about.
Unless you reduce the long-term spending burden, you cannot cut taxes in any lasting way, but can only shift the burden of taxes from the present to the future.
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