Discussion Paper

A Discussion of Thomas Piketty's Capital in the Twenty-First Century: Does More Capital Increase Inequality?

Abstract: My aim in the second post of this series on Thomas Piketty's Capital in the Twenty-First Century is to talk about the economist's research accomplishment in reconstructing capital-output ratios for developed countries from the Industrial Revolution to the present and using them to explain why wealth inequality will rise in developed countries. I will then provide a critical discussion of his interpretation of the history of capital in the developed world. Finally, I'll end by discussing Piketty's main policy proposal: the global tax on capital.

Keywords: Piketty; depreciation; capital-output ratio;

JEL Classification: E2; N2; R3;

Bibliographic Information

Provider: Federal Reserve Bank of New York

Part of Series: Liberty Street Economics

Publication Date: 2015-07-15

Number: 20150715