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What are the grand dynamics that drive the accumulation and distribution of capital? Questions about the long-term evolution of inequality, the concentration of wealth, and the prospects for economic growth lie at the heart of political economy. But satisfactory answers have been hard to find for lack of adequate data and clear guiding theories. In Capital in the Twenty-First Century, Thomas Piketty analyzes a unique collection of data from twenty countries, ranging as far back as the eighteenth century, to uncover key economic and social patterns. His findings will transform debate and set the agenda for the next generation of thought about wealth and inequality.
Piketty shows that modern economic growth and the diffusion of knowledge have allowed us to avoid inequalities on the apocalyptic scale predicted by Karl Marx. But we have not modified the deep structures of capital and inequality as much as we thought in the optimistic decades following World War II. The main driver of inequality--the tendency of returns on capital to exceed the rate of economic growth--today threatens to generate extreme inequalities that stir discontent and undermine democratic values. But economic trends are not acts of God. Political action has curbed dangerous inequalities in the past, Piketty says, and may do so again.
A work of extraordinary ambition, originality, and rigor, Capital in the Twenty-First Century reorients our understanding of economic history and confronts us with sobering lessons for today.
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Capital in the Twenty-First Century CAPITAL IN THE TWENTY-FIRST CENTURY Thomas Piketty Translated by Arthur Goldhammer The Belknap Press of Harvard University Press Cambridge, Massachusetts London, England 2014 Copyright © 2014 by the President and Fellows of Harvard College All rights reserved Printed in the United States of America First published as Le capital au XXI siècle, copyright © 2013 Éditions du Seuil Design by Dean Bornstein Library of Congress Cataloging-in-Publication Data Piketty, Thomas, 1971– [Capital au XXIe siècle. English] Capital in the twenty-first century / Thomas Piketty ; translated by Arthur Goldhammer. pages cm Translation of the author’s Le capital au XXIe siècle. Includes bibliographical references and index. ISBN 978-0-674-43000-6 (alk. paper) 1. Capital. 2. Income distribution. 3. Wealth. 4. Labor economics. I. Goldhammer, Arthur, translator. II. Title. HB501.P43613 2014 332'.041—dc23 2013036024 Contents Acknowledgments . vii Introduction . 1 Part One: Income and Capital 1. Income and Output . 39 2. Growth: Illusions and Realities . 72 Part Two: The Dynamics of the Capital/Income Ratio 3. The Metamorphoses of Capital . 113 4. From Old Europe to the New World . 140 5. The Capital/Income Ratio over the Long Run . 164 6. The Capital-Labor Split in the Twenty-First Century . 199 Part Three: The Structure of Inequality 7. Inequality and Concentration: Preliminary Bearings . 237 8. Two Worlds . 271 9. Inequality of Labor Income . 304 10. Inequality of Capital Ownership . 336 11. Merit and Inheritance in the Long Run . 377 12. Global Inequality of Wealth in the Twenty-First Century . 430 Part Four: Regulating Capital in the Twenty-First Century 13. A Social State for the Twenty-First Century . 471 14. Rethinking the Progressive Income Tax . 493 15. A Global Tax on Capital . 515 16. The Question of the Public Debt . 540 Conclusion . 571 Notes . 579 Contents in Detail . 657 List of Tables and Illustrations . 665 Index . 671 Acknowledgments This book is based on fifteen years of research (1998–2013) devoted essentially to understanding the historical dynamics of wealth and