Clearly, extreme inequality is undesirable. From a conceptual and philosophical point of view, does it make sense to think of an "optimal degree" of inequality. If yes, what would this optimal be? Would it be zero degree of inequality?

RE: "Clearly, extreme inequality is undesirable."

Not clear to me. It depends on the nature or particulars of the inequality. For example, if those at the lower level have the goods for a decent level of wellbeing and those at the higher level aren't adversely affecting those at the lower levels, why should there necessarily be a problem? And for a different sort of example, the inequality between a billionaire and a mere millionaire is huge, but nothing for a millionaire to get upset about.

Karl Pfeifer Point accepted. We would have to define the measure of inequality. So the focus of the debate should be less on inequality per se, but on the two particulars you mentioned. Do the unequal have sufficient for a "decent" living, and the impact of the rich on the poor that is directly attributable to the inequality. then the discussion will shift to the meaning of a decent living, and this could lead to a discussion on minimum income support, which is another whole topic.