Sunday, July 24, 2022

Piketty in Brief

I just read Thomas Piketty's latest book, A Brief History of Equality. It is the best window into Piketty's thinking to date in part because it is, unlike his previous books, mercifully short (244 pages, not counting the appendix).

Of course, Piketty's thinking is very different from mine. Words like supply, demand, comparative advantage, and the mutual gains from trade are almost entirely absent from his book. Instead, we hear a lot about political power and exploitation of the weak by the strong. In Piketty's worldview, the standard undergraduate textbook in economics is largely a non sequitur. So is Adam Smith's The Wealth of Nations.

This new book purports to summarize the key points of the massive volumes that Piketty has previously written. What I found most interesting, therefore, was what was not included. Piketty does not mention "the central contradiction of capitalism," to use the phrase from his book Capital in the 21st Century. In that earlier book, we were told that r>g leads to an "endless inegalitarian spiral." For reasons I explained here, I always thought that this claim was absurd.

Why is this major theme from the earlier book omitted in this new one? Has Piketty tacitly recanted? It is hard to say.