People prefer greater reward for greater effort.

"There's a problem with the way we define inequality," wrote Bryan Lufkin. We know that 1% of the richest people owns 50% of the wealth of the entire planet. The richest 1% of Indians owns 58.4% of the nation's wealth, up from 53% last year and 40.3% in 2010. A few years back Prof Thomas Piketty took the world by storm with his book "Capital in the Twenty-first Century", which showed how inequality is increasing in every country as returns from capital are increasing fast, while productivity of workers in falling. Some researchers suggest that people prefer inequality, meaning reward should reflect the quality of work. In an experiment 6-8 year-old children gave equal reward for equal work but rewarded a boy who worked harder. Lack of inequality, meaning absence of greater reward for higher quality work, was probably the main reason why communism failed in the Soviet Union. So, some are now suggesting that inequality should be defined as a lack of fairness, rather than as a difference in possession of wealth. Prof Tyler Cowen suggested that a lack of mobility a arising from a lack of opportunities is really unfair. Megan McArdle struggles to find a way how governments can reduce inequality. Inequality is built into our society as some are born with more intelligence or some special talents. A government cannot make you more popular or improve your singing but can give money to the very poor. Just helping the poor to survive is unlikely to push them up the social ladder. So what of India? Everyone is agreed that inequality is increasing, even as the economy is growing. Some, like UD Choubey, want to go back to bad old days of command economy which had nearly bankrupted the nation in 1991, by sugar-coating it as state-capitalism. The 1991 crisis was actually caused by successive governments as they resorted to reckless spending, allowing inflation and deficits to spiral out of control. That forced the then Prime Minister, Narasimha Rao, to reform the economy, leading to faster growth. The economy has grown to over $2 trillion, foreign direct investment has increased and the stock market has soared, but agriculture is not doing well and job creation is pathetic. That led to the temptation of waiving loans to farmers to win the assembly election in UP, leading to farmers in other states demanding the same treatment. The total cost maybe in excess of Rs 2.57 trillion. This excess spending will show up in fiscal deficit of states even though the BJP government at the center, which was responsible for the waiver in UP, will show a reduced deficit. There are 2 types of people -- r and K types. The r type has many children and are poor parents, while the K type has few children and invests a lot of effort in their well-being and education. Sadly, India is full of the r type of people, producing a lot of children and depending on government handouts to survive, wrote A Nageswaran. Hence, the clamor for the equality of poverty.