At least on the surface, a great deal of the inequality in the United States today seems to be about the ownership of land. But on closer examination much of what we think of as the value of land is often the value of a grant from a local government (that doles such things out in a miserly fashion) of the right to build on a piece of land. Or often, it is the value of having something already built on a piece of land that has escaped by a grandfather clause from what would otherwise be a prohibition against building on a piece of land. The monopoly local governments have over all rights to build within a substantial area, and what they do with that monopoly, ends up keeping many people from being able afford to live near jobs that would sustain them financially or live near amenities that would brighten their lives. 

But even if there weren't such, one could worry that land ownership could be the source of much inequality--and a source of inequality that at some point in the past wasn't justified by an individual's effort or saving. John Locke tries to deal with this in two different way in his 2d Treatise on Government: “Of Civil Government”: by saying land can be claimed from an unowned state when labor mixed with it (see "On John Locke's Labor Theory of Property" and "John Locke: Property in the State of Nature"), and by saying that diminishing marginal utility limits how much land an individual can claim. In section 31 (in Chapter V "Of Property") he writes:

It will perhaps be objected to this, that if gathering the acorns, or other fruits of the earth, &c. makes a right to them, then any one may ingross as much as he will. To which I answer, Not so. The same law of nature, that does by this means give us property, does also bound that property too. “God has given us all things richly,” 1 Tim. vi. 12. is the voice of reason confirmed by inspiration. But how far has he given it us? To enjoy. As much as any one can make use of to any advantage of life before it spoils, so much he may by his labour fix a property in: whatever is beyond this, is more than his share, and belongs to others. Nothing was made by God for man to spoil or destroy. And thus, considering the plenty of natural provisions there was a long time in the world, and the few spenders; and to how small a part of that provision the industry of one man could extend itself, and ingross it to the prejudice of others; especially keeping within the bounds, set by reason, of what might serve for his use; there could be then little room for quarrels or contentions about property so established.

This means that the first few humans to go to a big new region should not have the right to claim the whole big region in order to profit from selling those rights to those who came later. Instead, they should only be able to claim the amount they can use with a reasonably high amount of additional utility from each acre. 

A principle that diminishing marginal utility limits the amount of previously unowned land one can claim can make land reform at the point a country modernizes reasonable: it is likely that those who have large amounts of land either inherited it from someone who claimed too much in the distant mists of the past, or inherited it from someone who stole the land from someone who had a more legitimate claim at that time. (There is a logical possibility that someone worked really hard and bought land from others fair and square, but I don't think that describes the modal large landowner in the types of countries that have done a land reform.) 

One current issue in the US where the principle that land claiming is limited by diminishing marginal utility is in rules governing coastal land. The Common Law makes land up to the high water mark a commons. This makes sense given the high marginal utility people get from swimming, enjoying the beach in other ways and walking along rivers. There is a constant temptation for those who own a house near a stretch of beach or river to obstruct others' access to that body of water. But the great enjoyment people get from having that access should make us suspicious of even very rich people who feel very much entitled to do so trying to get away with excluding people from that natural water access.  

One of the troublesome aspects of John Locke's principles for claiming land is that an amount of land that would be unreasonably large for someone to claim if the relevant technology is agricultural would be quite reasonable to claim if the only available technology was hunting and gathering. Thus, even though John Locke is coming from a place not very sympathetic to them, the Native Americans had a legitimate claim to their land even according to John Locke's principles according to the mostly hunting and gathering technology that prevailed when they, in fact claimed the land. To justify, theoretically, taking that land from the Native Americans, one would have to add the principle that when technology changes so that people need less land to support themselves, then previous land claims need to be reevaluated. In general, such a principle is a recipe for a big mess. Better to, at a minimum, require rich outsiders to purchase land as European Americans did from Native Americans in a few cases, and as the European New Zealanders did to a much greater degree from the Maori. If technology has really improved dramatically, they should be able to do so. So this is a safer principles for dealing with improvements in technology for getting more out of a given amount of land. To some, given large enough technological differences, the purchase prices in that kind of situation may look almost the same as forcible dispossession, but morally,  purchase even at a low price is vastly different from forcible dispossession.

(There is, of course, an issue of whether collectively-owned land was sold by appropriate collective decision-making processes. Did everyone who had partial ownership get compensated in some way? Did the individual who purported to sell violate group norms in doing so? This is akin to the idea that an important component of so-called colonial exploitation is often providing tools at a price to one set of indigenous people who want to oppress another set. One key subspecies of this is to give weapons to one set of indigenous people to steal ownership of something from another set of indigenous people and then sell portion of that to the outsiders.) 

I like it that (by my interpretation) John Locke has the equality-favoring principle of diminishing marginal utility built in as a component of his rule for claiming as property things created by nature. (Here I have written about land, but ideas logically available would be another set of things created by nature worthy of consideration in another post.) Diminishing marginal utility was one of the themes in my inaugural post "What is a Supply-Side Liberal?" and something I have followed up on in other posts as well:

• Inequality Aversion Utility Functions: Would $1000 Mean More to a Poorer Family than $4000 to One Twice as Rich?
• Inequality Is About the Poor, Not About the Rich

Because John Locke's ideas are so often used as a justification for the inequality we see around us being morally legitimate, it is good to be alert to every place where what he says doesn't necessarily go in that direction. Some inequality is justified, some isn't—by John Locke's theory as well as most other theories. (Trying to make the distinction between legitimate wealth and illegitimate wealth is a key theme of my column "Odious Wealth: The Outrage is Not So Much Over Inequality but All the Dubious Ways the Rich Got Richer.")

Update: Related to this post, John Quiggin writes "John Locke Against Freedom." Highly recommended.

Don't miss other John Locke posts. Links at "John Locke's State of Nature and State of War."