The capability approach to economic inequality

1Preliminary version. Comments are welcome, but please do not quote- yet. This paper has a twofold purpose: to make analysis of income distribution a part of the capability approach, and to make the capability approach the theoretical foundation of analysis of income distribution. The capability ap-proach to human advantage has not hitherto been applied in mainstream analysis of income and wealth. The paper argues, one the one hand, that the capability approach needs to include a measure of access to economic goods; on the other hand that a capability definition of income avoids several prob-lems inherent in the traditional, welfarist approach. Extended full income is proposed as a measure of economic capability. Extended full income is Beck-erian full income corrected for inter alia constraints on time. Time needed to care for children (and other dependants) is a constraint on available time. The capability approach will seek to compute the cost of children (and other special needs) by identifying objective moral and legal constraints on time and other resources through open democratic discussion rather than esoteric estimation of welfare.