The Contradictions of Capital in the 21st Century: The Picketty Opportunity

Abstract

In ‘The Contradictions of Capital in the 21st Century: The Picketty Opportunity’, 2016, Pat Hudson and Keith Tribe have collected responses from leading economic historians and economists inspired by a book about inequality of the distribution of income and wealth in selected western economies.1 Thomas Picketty's ‘Capital in the 21st Century’, 2014, was ‘an international blockbuster…. [its] sales …. fuelled by popular concern about growing income inequality and the links between inequality and global economic instability…’ (p. 1).2 Picketty claimed that inequalities of incomes and wealth, at the top end of the distribution in particular, were, since the 1980s, returning to an historical tendency to increase in the developed world. He provided extensive empirical support for this claim. His explanation centred on a ‘law’, that the rate of return on capital is greater than the rate of growth, which he interpreted in the language and logic of the neo-classical aggregate production function. Not surprisingly, each stage of his narrative proved fruitfully provocative.