Many have argued for examining economic inequalities alongside a range of other forms of inequality in capabilities (e.g. Therborn, 2013). The fact that economic resources (income and wealth) provide the means to other ends both now and in the future, highlights their importance. In addition, personal wealth holdings (examining inequalities in financial stocks in addition to financial flows) can provide important information on people’s future capability sets and financial security over the lifecycle.

The idea that it is possible to have ‘too much’ as well as ‘too little’ income or other economic resource has been explored by a number of scholars (see, for example, Robeyns, 2017). Where individuals have more resources than are needed, Robeyns outlines the moral position that these individuals have “too much” and suggests that development of a ‘richess line’ to complement the ‘poverty line’. Robeyns (and others) describe how concentration of income and wealth can have a negative bearing on other people’s capabilities; where money ‘buys’ power, or limits the opportunities of others.

Burchardt and Hick (2017) highlight how high income and wealth can be associated with freedoms enjoyed in other domains (political influence, geographical mobility, security and room for legal manoeuvre) and that the very well-off (elites) do not need to actualise these freedoms in order to secure advantage – the capability is often sufficient. In the context of advantage, Burchardt and Hick argue, the non-observable nature of people’s capabilities becomes more significant at high levels of income. Analysing ‘functionings’ in relation to ‘basic’ capabilities is more straightforward as absence is more likely to reflect a lack of capability. In the context of advantage, “as we move away from ‘basic’ achievements, the relationship between capabilities and functionings is likely to be governed to a greater extent by the preferences of the individual” (Burchardt and Hick, 2017, p.10). There is a strong case for using measures of income and wealth where they represent better proxies of the underlying capabilities than the available measures of ‘functionings’ (Burchardt and Hick, 2017).

Economically rewarding activities in the form of paid work and entrepreneurial activities are important because the income generated can assist individuals to pursue the life that they wish to lead, to support those dependent on them, such as children, and to avoid poverty and destitution. In addition to the income that work generates, work can be rewarding in its own right, particularly for those able to pursue an interest. We observe inequalities not just in the rewards from work but also in the quality of jobs. These inequalities include safety at work, autonomy, treatment at work and discrimination. Research shows that differences in these relations and conditions of work also impact on capabilities in other spheres of life (physical security, health, etc) (see, for example, Bartley, 2005). Some forms of work are precarious and temporary in nature and there can be large differences between conditions for those working in the formal and informal labour markets. Conditions can be particularly bad for individuals working under exploitative conditions and in forced labour (complete lack of autonomy). Measures for these aspects of dignified work are included in this domain.

Unequal access to the best opportunities and how this relates to family background and forms of discrimination are key aspects of labour market inequality captured in this domain. These are forms of social mobility and a number of different measures are included in this domain. These include standard measures of social mobility measuring the correlation between outcomes for parents and children (in income, earnings and social class) and perceptions of equal opportunity and social mobility.

The importance of paid work as an activity clearly varies between different age groups, with less importance for those old enough to retire from work and those able to retire on an adequate income. Not all individuals have access to pension income (and therefore need to work to secure an income) and some individuals choose to continue working past ‘retirement age’ for the non-pecuniary benefits that work has to offer.

This domain also covers forced labour, exploitative labour and child labour. Although children may ‘choose’ to work and income from their employment may make a crucial contribution to the family budget, child labour is considered a negative outcome. Child labour does not refer to ‘pocket-money’ jobs, it refers to work that deprives children of their childhood, their potential and their dignity which is harmful to physical and mental development (more information can be found in the ILO publication – What is child labour?). Similarly, children shouldering the burden of caring for other family members limits their capacity to engage in activities which would expand their adult capabilities or simply the freedom for children to ‘play’ and socialise with peers.

References and selected readings

Bartley, M. (2005). ‘Job insecurity and its effect on health’, Journal of Epidemiology and Community Health, 59:718-719

Burchardt, T. and Hick, R. (2017) ‘Inequality and the Capability Approach’, CASEpaper 201, Centre for Analysis of Social Exclusion, London School of Economics

Dillon, A. (2010). ‘Measuring child labor: Comparisons between hours data and subjective measures’, Research in Labor Economics, 31, 135-159

Ritualo, A. R., and Castro, C. L. and Gormly, S. (2003). ‘Measuring Child Labor: Implications for Policy and Program Design’, Comparative Labor Law & Policy Journal, Vol. 24, No. 2, pp. 401-434, Winter 2003

Robeyns, I. (2017) ‘Having Too Much’, in J. Knight and M. Schwartzberg (eds.) NOMOS LVI: Wealth. Yearbook of the American Society for Political and Legal Philosophy, New York University Press

Ruwanpura, K. N. and Rai, P. (2004). Forced Labour: Definitions, Indicators and Measurement, ILO working paper DECLARATION/WP/18/2004