Piketty via Milanovic

Screen Shot 2014-02-17 at 9.50.27 PM

I have written a few comments on Branko Milanovic’s review of Thomas Piketty’s celebrated new book, Capital in the 21st Century.  A pdf version of my comments can be found here:


Comments are all welcome.

IMPORTANT UPDATE: My friend David Laibman, whose book Capitalist Macrodynamics anticipated some of these novel claims, just made me see an egregious misunderstanding on my part: Piketty’s claim, of course, is not that r is growing faster than g_Y, but only that r (the level of the profit rate, not its growth rate) is greater than g_Y, which is entirely possible as K/Y goes up.  In Marxian terms, \beta = K/Y, which is a way of representing the composition of capital, \alpha is a measure of the rate of exploitation.  So clearly, r > g_Y even if K/Y goes up, as long as \alpha increases.  I stand corrected!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s