When distributions are decided democratically, people tend to opt for more egalitarian outcomes. As we presently see in the UK, many unions and the members they represent would prefer and are arguing for an even more equitable distribution than present pay scales represent. According to a report released by the British Medical Association, junior doctors pay currently falls short by a staggering 23% of where it should actually be. And there is strong opposition from employees and unions to the recent tendency in British universities and hospital trusts to have vice chancellors and CEOs who are paid outside the normal pay scale – a practice that should clearly be abolished.

For another benchmark, we can look at cooperatives. The Mondragon Corporation is a massive federation of democratically run businesses in Spain, with more than 80,000 workers. Across the enterprises, pay ratios average five to one. In some, it’s as low as three to one. This is further evidence that when people are given a fair say in the matter, they gravitate towards figures like these because of the fairer distribution of income and wealth.

If the same democratic logic was applied to any national economy, it would deliver dramatic reductions in inequality. This would help cut corruption out of our political systems, it would improve our sense of solidarity, and it would deliver benefits that are known to be associated with a more egalitarian distribution of income: everything from lower crime rates to less social anxiety.

People tend to think of income as an abstract number, and this abstraction gives rise to the impression that there’s no reason to impose a limit. In reality, however, income represents control over the collective product, and command over labour. A pay ratio of five to one means that one person can command the labour of five, and can consume five times more of everything the economy produces: five times more houses, cars, flights, televisions and food. Put in these terms, five to one may well seem too high, and it makes sense that unions often opt for career stage-adjusted ratios closer to two to one.

Income also represents command over finite resources and energy. We should ask ourselves: how much more of our planet – and of the global carbon budget – should one person be allowed to consume than another? In an era of ecological breakdown, it is clearly irrational to continue devoting resources and energy to supporting an overconsuming class.

For decades, ecological economists have called for a cap on pay ratios: the introduction of a strong living wage or minimum-income laws to put a floor on the bottom, and the use of a maximum-income policy to put a ceiling on the top. Income inequalities can also be reduced with policies like a public job guarantee and universal public services, which dramatically improve the bargaining power of labour, and allow us to organise production around urgent social and ecological goals. This approach would allow us to rebuild social solidarities, rebuild democracy and ensure better lives for all.

Once we start to understand income as having control over the collective product, and as command over the planet’s resources – with social and ecological consequences – it is entirely reasonable that pay ratios should be democratically decided, with strong protections against extreme inequality. Yet, it is concerning that this is almost never the case in practice. If we claim to value democracy, democratic principles should be applied to the question of distribution.