Inequality and Concentration: Preliminary Bearings

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Notes from GV4D4 week 3

addresses the mistaken concept that growth favours labour over inheritance
(spoiler: it usually doesn't)
in 19th century France, labour alone (no matter your profession) was rarely
enough to compete with inherited wealth
in the US it was different (inherited wealth mattered little) until the 20th,
especially due to the slave trade and all the compounding consequences of
that
it's important to distinguish between income/wealth inequality for labour,
and that for capital, because the moral justifications are different
and the econ/socio/political mechanisms are different
for labour: market, education, rules and institutions
for capital: inheritance laws, savings and investment behaviour, real
estate and financial markets
income inequality for capital is always more unequal than for labour
but this is due to political institutions and norms, not nature
the 20th century saw a huge structural transformation in the distribution of
wealth in developed countries
growth of a patrimonial (propertied) middle class)
coincided with a falling share of wealth held by the upper class
prediction: by 2030, top decile in US will have 60% of NI
now let's look at justifications of high inequality:
in a hyperpatrimonial society (with lots of rentiers), inherited wealth
plays a huge role and has a tendency to become very concentrated
this describes Belle Époque Europe (1871-1914) and the Ancien Régime
(pre-revolution France)
contemporary society is more "hypermeritocratic", esp in the US (and dw,
Piketty is well aware that "meritocracies" are smokescreens used for
justifying unjustifiable distributions of wealth/opportunity)---inequality
is primarily due to a class of "supermanagers" with high labour income
ofc, the two models can coexist; the children of supermanagers/superstars
can become rentiers


        Piketty, T. (2014). Inequality and Concentration: Preliminary Bearings. In Piketty, T. Capital in the Twenty-First Century. Belknap Press, pp. 237-270

a term coined by Thomas Piketty; a system where the economic elite mostly attain their fortunes through inheritance rather than entrepreneurship or innovation

237

the impression that patrimonial capitalism— which is flourishing in these early years of the twenty-first century— is something new, whereas it is in large part a repetition of the past and characteristic of a low-growth environment like the nineteenth century.

—p.237 by Thomas Piketty

notable

7 years ago

the impression that patrimonial capitalism— which is flourishing in these early years of the twenty-first century— is something new, whereas it is in large part a repetition of the past and characteristic of a low-growth environment like the nineteenth century.

—p.237 by Thomas Piketty

notable

7 years ago

conventionally dated from the end of the Franco-Prussian War in 1871 to the outbreak of World War I in 1914; characterized by optimism, regional peace, economic prosperity, apex of colonial empires and technological, scientific and cultural innovations

264

The total income hierarchy is then dominated by very high incomes from capital, especially inherited capital. This is the pattern we see in Ancien Régime France and in Europe during the Belle Époque,

on a "hyperpatrimonial society" (or "society of rentiers")

—p.264 by Thomas Piketty

confirm

7 years ago

The total income hierarchy is then dominated by very high incomes from capital, especially inherited capital. This is the pattern we see in Ancien Régime France and in Europe during the Belle Époque,

on a "hyperpatrimonial society" (or "society of rentiers")

—p.264 by Thomas Piketty

confirm

7 years ago

Capital in the Twenty-First Century
by Arthur Goldhammer, Thomas Piketty

Capital in the Twenty-First Century
by Arthur Goldhammer, Thomas Piketty

Capital in the Twenty-First Century
by Arthur Goldhammer, Thomas Piketty