The FT has a piece critical of Thomas Piketty's wealth data in his new book "Capital in the 21st Century." I already wrote a response to that piece in which I point out that Piketty's US wealth data is entirely consistent with newer and much-improved data from Emmanuel Saez and Gabriel Zucman. Also in response to the FT piece, Mike Konczal has a post that argues FT got Piketty's argument wrong.
Building on Konczal's piece, I want to explain Piketty's two separate arguments for why income inequality will increase in the future. And there are actually two, despite what many reviewers seem to think.
This is a very clear and concise outline of Piketty's essentially neoclassical model and how it works.
What Pikketty's model doesn't account for is for the asymmetry in the capital-labor share of income or why capital accumulates at the top. Heterodox analysis shows how distributional effects are institutional effects rather than the result of economic laws.
Demos — Policy Shop
Piketty Has Two Separate Income Inequality Theories
Matt Bruenig
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