The Institute Blog

Piketty Responds in Detail to FT Criticism

Thomas Piketty has written a detailed response to the critique of his work by the Financial Times. His full response is available here and the first few paragraphs are below.

Full Disclosure: The Institute for New Economic Thinking has extensively supported the World Top Incomes Database on which Piketty’s book Capital in the 21st Century draws extensively.

“This is a response to the criticisms - which I interpret as requests for additional information - that were published in the Financial Times on May 23 2014. These criticisms only refer to the series reported in chapter 10 of my book Capital in the 21st Century, and not to the other figures and tables presented in the other chapters, so in what follows I will only refer to these series.

This response should be read jointly with the technical appendix [link is in paper] to my book, and particularly with the appendix to Chapter 10 (available here) [Link is in paper]…

Let me start by saying that the reason why I put all excel files on line, including all the detailed excel formulas about data constructions and adjustments, is precisely because I want to promote an open and transparent debate about these important and sensitive measurement issues.

Let me also say that I certainly agree that available data sources on wealth inequality are much less systematic than what we have for income inequality. In fact, one of the main reasons why I am in favor of wealth taxation, international cooperation and automatic exchange of bank information is that this would be a way to develop more financial transparency and more reliable sources of information on wealth dynamics (even if the tax was charged at very low rates, which everybody could agree with).”

Piketty Technical Appendix & Response to FT62.09 KB