The Economics of Inequality

by Thomas Piketty, Arthur Goldhammer (Translator)

Overview

Thomas Piketty—whose Capital in the Twenty-First Century pushed inequality to the forefront of public debate—wrote The Economics of Inequality as an introduction to the conceptual and factual background necessary for interpreting changes in economic inequality over time. This concise text has established itself as an indispensable guide for students and general readers in France, where it has been regularly updated and revised. Translated by Arthur Goldhammer, The Economics of Inequality now appears in English for the first time.

Piketty begins by explaining how inequality evolves and how economists measure it. In subsequent chapters, he explores variances in income and ownership of capital and the variety of policies used to reduce these gaps. Along the way, with characteristic clarity and precision, he introduces key ideas about the relationship between labor and capital, the effects of different systems of taxation, the distinction between “historical” and “political” time, the impact of education and technological change, the nature of capital markets, the role of unions, and apparent tensions between the pursuit of efficiency and the pursuit of fairness.

Succinct, accessible, and authoritative, this is the ideal place to start for those who want to understand the fundamental issues at the heart of one of the most pressing concerns in contemporary economics and politics.

Product Details

ISBN-13:	9780674504806
Publisher:	Harvard University Press
Publication date:	08/03/2015
Edition description:	Translatio
Pages:	154
Sales rank:	837,902
Product dimensions:	5.50(w) x 8.30(h) x 0.80(d)

About the Author

Thomas Piketty is Professor of Economics and Economic History at L’École des Hautes Études en Sciences Sociales (EHESS) and at the Paris School of Economics and Codirector of the World Inequality Lab.

Table of Contents

Note to the Reader vii

Introduction 1

1 The Measurement of Inequality and Its Evolution 5

2 Capital-Labor Inequality 26

3 Inequality of Labor Income 66

4 Instruments of Redistribution 100

References 123

Contents in Detail 131

Index 135

Editorial Reviews

06/29/2015
Piketty’s 2013 masterwork, Capital in the Twenty-First Century, made income inequality a household phrase—particularly for those who hope to move their own households to the White House. This earlier work, first published in 1997 and since revised and updated, is more approachable, and it arrives at the same dismal conclusion: the rich are getting richer and the poor, poorer. In the developed world, this phenomenon occurs most sharply in the U.S., where the top 10% collectively have 5.9 times the disposable income of the bottom 10%. In Sweden, by contrast, the figure is 2.7. Piketty isn’t a sloppy or partisan thinker, and he methodically criticizes ineffective solutions from the left. In his view, the poor usually bear the brunt of these, whether in increased payroll deductions for social insurance, higher marginal income tax rates, or unemployment. Piketty, who believes income inequality leads to political instability, proposes a guaranteed minimum income or “basic income” as an efficient means of redistribution. He also explains how economists measure economic inequality and looks at the phenomenon’s underlying causes (which do not include hedge fund managers or Chinese laborers.) If Piketty is right, inequality is increasing and cannot be cured by the free market; we must understand the problem to understand how to address it. This should be required reading for every concerned citizen. (Aug.)

Publishers Weekly

Even a brief guide to basic concepts in Piketty’s field of study can remind you, at every turn, that something profound is going on within the global economic system. The data, especially the data from recent decades, does not conceal the tale…Avarice and plunder play no part in the language of economics, but they too are causes and consequences of the phenomena Piketty describes. In some respects, his work is an assault on the kind of cult thinking that these days passes for economic and political analysis.

Glasgow Herald - Ian Bell

Translated into English for the first time, it offers an exceptionally clear, cogent, and coherent discussion of economic inequality.

Foreign Affairs - Richard N. Cooper

Piketty’s The Economics of Inequality is an excellent book and a great companion to Capital. This book is a remarkable mix of extensive data, attention to theory, and concern for policy.

Axel Gosseries

Piketty’s The Economics of Inequality, which acts as a primer, provides a useful starting point for a wide audience.

Tom Healy

In a work that is aligned with but antecedent to his grand synthesis, Capital in the Twenty-First Century, French economist Piketty examines the structural causes of inequality… A discussion worth having and a book worth reading.
— Kirkus Reviews

Piketty’s The Economics of Inequality is an excellent book and a great companion to Capital. This book is a remarkable mix of extensive data, attention to theory, and concern for policy.
— Axel Gosseries, Fund for Scientific Research (FRS-FNRS) and University of Louvain (UCL)

If Piketty is right, inequality is increasing and cannot be cured by the free market; we must understand the problem to understand how to address it. This should be required reading for every concerned citizen.
— Publishers Weekly

Even a brief guide to basic concepts in Piketty’s field of study can remind you, at every turn, that something profound is going on within the global economic system. The data, especially the data from recent decades, does not conceal the tale…Avarice and plunder play no part in the language of economics, but they too are causes and consequences of the phenomena Piketty describes. In some respects, his work is an assault on the kind of cult thinking that these days passes for economic and political analysis.
— Ian Bell Glasgow Herald

Piketty’s The Economics of Inequality, which acts as a primer, provides a useful starting point for a wide audience.
— Tom Healy Irish Times

Translated into English for the first time, it offers an exceptionally clear, cogent, and coherent discussion of economic inequality.
— Richard N. Cooper Foreign Affairs

From the Publisher

07/01/2015
French economist and best-selling author Piketty (economics, Paris Sch. of Economics; Capital in the Twenty-First Century) first wrote this short book on economic inequality in 1997. In it, he examines the ways such inequality can be measured: the disproportion between capital and labor, and of income from labor, and the tools available to lessen such imbalance. Much of his discussion centers on France, but he pulls in data and examples from other countries, particularly the United States. Piketty concedes that although the work has been updated, it is still essentially a representation of the data available in 1997. Few of the cited references are later than the mid 1990s. Nonetheless, the author's insightful examination of topics such as employer discrimination, unions, and minimum wage laws are pertinent today. Though the author's style is not overly technical, it is academic in tone, and some background in economics would be helpful for full understanding. VERDICT Most readers will be better served by Capital in the Twenty-First Century, leaving students and economists as the likeliest audience for this title.—Lawrence Maxted, Gannon Univ. Lib., Erie, PA

Library Journal

2015-05-20
In a work that is aligned with but antecedent to his grand synthesis, Capital in the Twenty-First Century (2013), French economist Piketty examines the structural causes of inequality. Capital and income are intertwined, of course, and unevenly distributed. Just how unevenly has been a subject of much economic-historical work lately. In this book, published in 1997 and updated here and there since, Piketty observes that he does not "take fully into account the results of the past fifteen years of international research on the historical dynamics of inequality," but the eternal verities hold. As the author writes, in a moment worthy of Marx, "the question of inequality and redistribution is central to political conflict." Redistribute broadly and equitably, and you have the possibility of social justice; redistribute into the hands of the wealthy, and you risk turmoil and revolution when the have-nots catch on to what's going on. Piketty's argument is more descriptive than prescriptive; he notes that capital income, for instance, is subject to more unequal distribution than wage income, which makes good sense inasmuch as the rich tend to live on capital gains instead of salaries. The writing tends to be white paper-ish and technical ("in the United States…the P90/P10 ratio for income rose from 4.9 to 5.9 between 1979 and 1986"), and although training in economics isn't strictly necessary in order to follow the author's argument, it certainly wouldn't hurt in tracking such concepts as the relative elasticity or inelasticity of capital and, particularly, human capital. The latter contributes strongly to Piketty's case, which ends with a consideration of how Keynesian stimuli can influence long-term redistribution, if at all. Not for the numerically faint of heart, and those who are numerate may argue at points—just as Piketty's masterwork has inspired controversy. Still, a discussion worth having and a book worth reading.

Kirkus Reviews