John Rawls argues in A Theory of Justice that inequalities are permissible if they benefit society's worst-off, in terms of division of social primary goods (defined as "rights, liberties and opportunities, and income and wealth"). Put differently, this means that highly-skilled people should earn higher salaries, as incentives to perform their jobs, for those jobs enables society's development and prosperity, which benefit everyone, including the worst-off. The purpose of this essay is to discuss, in line with G. A. Cohen's critique of the Rawlsian theory, the extent to which wage inequality is permissible and defensible. To make it concrete, it uses the example of Paula: Paula is highly-skilled and could very well run a large company. However, she dreams to be a baker. As a CEO, she would create a lot of wealth that could be redistributed to benefit the worst-off. As a baker, she does not generate anything to benefit them. While she earns a medium-high income M as a CEO, her wage as a baker is low (B). To forgo her passion for bakery, she asks for an incentive wage of M', much higher than M. I will argue that she is not justified in asking for M', for this creates an inequality that is not necessary, but just furthers and, rather than genuine wage incentive, constitutes blackmail.
How to Cite:
Paugam, G., 2016. A Discussion of Incentive Inequality in Rawlsian Theory. Rerum Causae, 8(1), pp.37–45.