Welfare State, Redistribution Of Wealth And Role of Capitalism

GS Paper III Issue 1, December 9, 2019. Issue: Redistribution of wealth, welfare state and role of capitalism

For any democracy, redistribution of wealth is an important issue. If wealth is allowed to be created, and it is not distributed properly, then inequality will persist. It will be hard to lift people out of poverty. But, some economists suggest that business houses/corporate sectors/private companies should be incentivized properly by the government to create wealth. If enough wealth is not created, then what wealth will be distributed. Hence, instead of leaning towards welfare state, government should support wealth creators.

Let us discuss the merits of this argument:

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