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T. Piketty - "Capital in the 21st century"


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Meni isto pada na pamet sledeća stvar, koja je verovatno prežvakana milion puta od strane raznoraznih ekonomista - da li je postojanje ultrabogatih koristan motivišući faktor za preduzetnike, tj. za wannabe bogataše. Ako pogledamo američke ultrabogate, naćićemo mnogo primera koji nisu to nasledili već su počeli sa dosta skromnijih pozicija (Gejts, Pejdž, Brin, Bafet, Blumberg, itd.) - OK niko od njih počeo kao dete iz geta ali su bili srednja klasa (niža ili viša). Dakle, ukoliko je prosek dobar i raste a najsiromašniji takođe nekako napreduju i imaju široku podršku države i mogućnosti da iz siromaštva izađu, možda je postojanje superuspešnih bogatih biznismena korisna kao faktor motivacije da ljudi pokreću biznise i veruju u velike ideje.

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Ajd da postavim jos nesto stp sam vec kacio na nauci ali ima veze sa temom, kada vec pricamo o nejednakosti u smislu sirem od onog koji analizira Piketi.


Zapravo, Piketi tretira nejednakost u okviru growth litrature (tu se pominju Hard-Domar, Solou i sl. modeli rasta o kojima ja ne znam gotovo nista) dok Hekman i ostali tretirjau nejednakost u okviru development lietarature.

Prva je makro, druga mikro u pristupu.



Your Ancestors, Your Fate By GREGORY CLARK Inequality of income and wealth has risen in America since the 1970s, yet a large-scale research study recently found that social mobility hadn’t changed much during that time. How can that be?

The study, by researchers at Harvard and Berkeley, tells only part of the story. It may be true that mobility hasn’t slowed — but, more to the point, mobility has always been slow.

When you look across centuries, and at social status broadly measured — not just income and wealth, but also occupation, education and longevity — social mobility is much slower than many of us believe, or want to believe. This is true in Sweden, a social welfare state; England, where industrial capitalism was born; the United States, one of the most heterogeneous societies in history; and India, a fairly new democracy hobbled by the legacy of caste. Capitalism has not led to pervasive, rapid mobility. Nor have democratization, mass public education, the decline of nepotism, redistributive taxation, the emancipation of women, or even, as in China, socialist revolution.


To a striking extent, your overall life chances can be predicted not just from your parents’ status but also from your great-great-great-grandparents’. The recent study suggests that 10 percent of variation in income can be predicted based on your parents’ earnings. In contrast, my colleagues and I estimate that 50 to 60 percent of variation in overall status is determined by your lineage. The fortunes of high-status families inexorably fall, and those of low-status families rise, toward the average — what social scientists call “regression to the mean” — but the process can take 10 to 15 generations (300 to 450 years), much longer than most social scientists have estimated in the past.

We came to these conclusions after examining reams of data on surnames, a surprisingly strong indicator of social status, in eight countries — Chile, China, England, India, Japan, South Korea, Sweden and the United States — going back centuries. Across all of them, rare or distinctive surnames associated with elite families many generations ago are still disproportionately represented among today’s elites.

Does this imply that individuals have no control over their life outcomes? No. In modern meritocratic societies, success still depends on individual effort. Our findings suggest, however, that the compulsion to strive, the talent to prosper and the ability to overcome failure are strongly inherited. We can’t know for certain what the mechanism of that inheritance is, though we know that genetics plays a surprisingly strong role. Alternative explanations that are in vogue — cultural traits, family economic resources, social networks — don’t hold up to scrutiny.

Because our findings run against the intuition that modernity, and in particular capitalism, has eroded the impact of ancestry on a person’s life chances, I need to explain how we arrived at them.

Let’s start with Sweden, which — like Denmark, Finland, Iceland and Norway — is one of the world’s most equal societies in terms of income. To our surprise, we found that social mobility in Sweden today was no greater than in Britain or the United States today — or even Sweden in the 18th century.

Sweden still has a nobility. Those nobles no longer hold de facto political power, but their family records are stored by the Riddarhuset (House of Nobility), a society created in 1626. We estimate that about 56,000 Swedes hold rare surnames associated with the three historic tiers of nobles. (Variations on the names of the unfortunate Rosencrantz and Guildenstern of “Hamlet” are on the list.)

Another elite group are Swedes whose ancestors — a rising educated class of clerics, scholars, merchants — Latinized their surnames in the 17th and 18th centuries (like the father of the botanist Carolus Linnaeus). Adopting elite names was limited by law in Sweden in 1901, so a vast majority of people holding them are descended from prominent families.

Given the egalitarian nature of Swedish society, one would expect that people with these elite surnames should be no better off than other Swedes. That isn’t so. In a sample of six Stockholm-area municipalities in 2008, rich and poor, we found that the average taxable income of people with noble names was 44 percent higher than that of people with the common surname Andersson. Those with Latinized names had average taxable incomes 27 percent higher than those named Andersson.

Surnames of titled nobles (counts and barons) are represented in the register of the Swedish Bar Association at six times the rate they occur in the general population (three times the rate, for untitled-noble and Latinized surnames). The same goes for Swedish doctors. Among those who completed master’s theses at Uppsala University from 2000 to 2012, Swedes with elite surnames were overrepresented by 60 to 80 percent compared with those with the common surname prefixes Lund- and Berg-.


Over centuries, there is movement toward the mean, but it is slow. In three of the Royal Academies of Sweden, half of the members from 1740 to 1769 held one of the elite surnames in our sample; by 2010, only 4 percent did — but these surnames were held by just 0.7 percent of all Swedes, so they were still strongly overrepresented. In short, nearly 100 years of social democratic policies in Sweden, while creating a very egalitarian society, have failed to accelerate social mobility.

What if we go back even further in time — to medieval England?

We estimate that one-tenth of all surnames in contemporary England can be traced to the occupation of a medieval ancestor — names like Smith (the most common surname in the United States, England and Australia), Baker, Butler, Carter, Chamberlain, Cook, Shepherd, Stewart and Wright. Tax records suggest that most surnames became heritable by 1300.

We compared the frequency of these common surnames in the population as a whole against elite groups, as drawn from several sources, including membership rolls at Oxford and Cambridge, dating as far back as 1170, and probate records from 1384 onward.

We found that late medieval England was no less mobile than modern England — contrary to the common assumption of a static feudal order. It took just seven generations for the successful descendants of illiterate village artisans of 1300 to be incorporated fully into the educated elite of 1500 — that is, the frequency of their names in the Oxbridge rolls reached the level around where it is today. By 1620, according to probate records, people with names like Butcher and Baker had nearly as much wealth as people with high-status surnames like Rochester and Radcliffe.

Take Chaucer. A commoner by birth — his name probably comes from the French word for shoemaker — he became a courtier, a diplomat and a member of Parliament, and his great-great-grandson was even briefly considered heir to the throne during the reign of Richard III.

Of course, mobility, in medieval times as now, worked both ways. Just as Chaucer’s progeny prospered, other previously well-off families declined. The medieval noble surname Cholmondeley was, by the 19th century, held by a good number of farm laborers.

In any generation, happy accidents (including extraordinary talent) will produce new high-status families. It is impossible to predict which particular families are likely to experience such boosts. What is predictable is what the path to elite status will look like, and the path back to the mean. Both happen at a very slow pace.

For all the creative destruction unleashed by capitalism, the industrial revolution did not accelerate mobility. Looking at 181 rare surnames held by the wealthiest 15 percent of English and Welsh people in the mid-19th century — to be clear, these were not the same elite surnames as in the medieval era — we found that people with these surnames who died between 1999 and 2012 were more than three times as wealthy as the average person.

If your surname is rare, and someone with that surname attended Oxford or Cambridge around 1800, your odds of being enrolled at those universities are nearly four times greater than the average person. This slowness of mobility has persisted despite a vast expansion in public financing for secondary and university education, and the adoption of much more open and meritocratic admissions at both schools.

What about America, the self-proclaimed land of opportunity?

We selected a sampling of high- and low-status American surnames. The elite ones were held by descendants of Ivy League alumni who graduated by 1850, exceptionally wealthy people with rare surnames in 1923-24 (when public inspection of income-tax payments was legal) and Ashkenazi Jews. The low-status names were associated with black Americans whose ancestors most likely arrived as slaves, and the descendants of French colonists in North America before 1763.

We chose only surnames closely correlated with these subgroups — for example, Rabinowitz for American Jews, and Washington for black Americans.

We used two indicators of social status: the American Medical Association’s directory of physicians and registries of licensed attorneys, along with their dates of registration, in 25 states, covering 74 percent of the population.

In the early to mid-20th century we found the expected regression toward the mean for all of these groups, except for Jews and blacks — which reflects the reality of quotas that had barred Jews from many elite schools, and of racial segregation, which was not fully outlawed until the 1960s.

Starting in the 1970s, Jews began, over all, a decline in social status, while blacks began a corresponding rise, at least as measured by the doctors’ directory. But both trends are very slow. At the current rate, for example, it will be 300 years before Ashkenazi Jews cease to be overrepresented among American doctors, and even 200 years from now the descendants of enslaved African-Americans will still be underrepresented.

Family names tell you, for better or worse, a lot: The average life span of an American with the typically Jewish surname Katz is 80.2 years, compared with 64.6 years for those with the surname Begay (or Begaye), which is strongly associated with Native Americans. Heberts, whites of New France descent, live on average three years less than Dohertys, whites of Irish descent.

But to be clear, we found no evidence that certain racial groups innately did better than others. Very high-status groups in America include Ashkenazi Jews, Egyptian Copts, Iranian Muslims, Indian Hindus and Christians, and West Africans. The descendants of French Canadian settlers don’t suffer racial discrimination, but their upward mobility, like that of blacks, has been slow.

Chen (a common Chinese surname) is of higher status than Churchill. Appiah (a Ghanaian surname) is higher than Olson (or Olsen), a common white surname of average status. Very little information about status can be surmised by the most common American surnames — the top five are Smith, Johnson, Williams, Brown and Jones, which all originated in England — because they are held by a mix of whites and blacks.

Our findings were replicated in Chile, India, Japan, South Korea and, surprisingly, China, which stands out as a demonstration of the resilience of status — even after a Communist revolution nearly unparalleled in its ferocity, class hatred and mass displacement.

Hundreds of thousands of relatively prosperous mainland Chinese fled to Taiwan with the Nationalists in the late 1940s. Under Communist agrarian reform, as much as 43 percent of all land was seized and redistributed. The Cultural Revolution of 1966-76 saw purges of scholars and other former elites and “class enemies.”

In China, there are only about 4,000 surnames; the 100 most common are held by nearly 85 percent of the population. Yet we were able to identify 13 rare surnames that were exceptionally overrepresented among successful candidates in imperial examinations in the 19th century. Remarkably, holders of these 13 surnames are disproportionately found now among professors and students at elite universities, government officials, and heads of corporate boards. Social mobility in the Communist era has accelerated, but by very little. Mao failed.

These findings may surprise two groups that are often politically opposed: those who believe that certain “cultures” are higher-achieving than others and those who attribute success to family resources and social networks.

Culture is a nebulous category and it can’t explain the constant regression of family status — from the top and the bottom. High-status social groups in America are astonishingly diverse. There are representatives from nearly every major religious and ethnic group in the world — except for the group that led to the argument for culture as the foundation of social success: white European Protestants. Muslims are low-status in much of India and Europe, but Iranian Muslims are among the most elite of all groups in America.

Family resources and social networks are not irrelevant. Evidence has been found that programs from early childhood education to socioeconomic and racial classroom integration can yield lasting benefits for poor children. But the potential of such programs to alter the overall rate of social mobility in any major way is low. The societies that invest the most in helping disadvantaged children, like the Nordic countries, have produced absolute, commendable benefits for these children, but they have not changed their relative social position.

The notion of genetic transmission of “social competence” — some mysterious mix of drive and ability — may unsettle us. But studies of adoption, in some ways the most dramatic of social interventions, support this view. A number of studies of adopted children in the United States and Nordic countries show convincingly that their life chances are more strongly predicted from their biological parents than their adoptive families. In America, for example, the I.Q. of adopted children correlates with their adoptive parents’ when they are young, but the correlation is close to zero by adulthood. There is a low correlation between the incomes and educational attainment of adopted children and those of their adoptive parents.

These studies, along with studies of correlations across various types of siblings (identical twins, fraternal twins, half siblings) suggest that genetics is the main carrier of social status.

If we are right that nature predominates over nurture, and explains the low rate of social mobility, is that inherently a tragedy? It depends on your point of view.

The idea that low-status ancestors might keep someone down many generations later runs against most people’s notions of fairness. But at the same time, the large investments made by the super-elite in their kids — like those of the Manhattan hedge-funders who spend a fortune on preschool — are of no avail in preventing long-run downward mobility.

Our findings do suggest that intermarriage among people of different strata will raise mobility over time. India, we found, has exceptionally low mobility in part because religion and caste have barred intermarriage. As long as mating is assortative — partners are of similar social status, regardless of ethnic, national or religious background — social mobility will remain low.

As the political theorist John Rawls suggested in his landmark work “A Theory of Justice” (1971), innate differences in talent and drive mean that, to create a fair society, the disadvantages of low social status should be limited. We are not suggesting that the fact of slow mobility means that policies to lift up the lives of the disadvantaged are for naught — quite the opposite. Sweden is, for the less well off, a better place to live than the United States, and that is a good thing. And opportunities for people to flourish to the best of their abilities are essential.

Large-scale, rapid social mobility is impossible to legislate. What governments can do is ameliorate the effects of life’s inherent unfairness. Where we will fall within the social spectrum is largely fated at birth. Given that fact, we have to decide how much reward, or punishment, should be attached to what is ultimately fickle and arbitrary, the lottery of your lineage.

Gregory Clark is a professor of economics at the University of California, Davis, and the author of “The Son Also Rises: Surnames and the History of Social Mobility.”




I papir:


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oduvek sam znao da su crnogorci genetski superiorni.


inace, procitao knjigu pa cu sutra malo da napisem nesto.



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oduvek sam znao da su crnogorci genetski superiorni.


inace, procitao knjigu pa cu sutra malo da napisem nesto.



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ajde pisi vise oca mu ocinjeg :) 

ovo me intrigira vec par dana.ne cini mi se novoga mnogo niti tu formule ima koja je za al ima protu sto je mlooogo vaznije.porez za sve isti!!to je revolucija mislim ono cime se zavaravaju da je ista.cekam vas nekoliko da napisete nesto i pozurite.


gresis za mne genetski kapacitet osim ako je to neka opsta ravnicarska posalica 

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podseti me na freakonomics /ok, petparacka literatura donekle/

davanje imena svojoj deci

primer oca koji je dao imena sinovima - loser I winner

da li su afro imena posledica ili razlog ekonomske nejednakosti

da li deshawn I precious signalizuju poreklo pa ih jebu prilikom zaposljavanja

da li je deshawn - deshawn jer su mu roditelji odrasli u getu pa mu je startna pozicija sjebana

sta ako promeni ime - hoce li ga zvati na job interviews

da li preciouses™ I ashleys, ambers, samanthas (ovo mu dodju kao white counterparts) zive u siromasnim oblastima™

I kako to da su to 1 bila normalna™ imena a sada se getoizovala

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problem Piketove knjige, kao i mnogih drugih, je sto se znatno vise orijentisu na savremeno doba. tj. od industrijske revolucije do danas. razlog je ocit, znatno vise podataka imamo za moderne industrijske drzave nego za period pre parne masine.


time se u analizi bavimo periodom maltene neprekinutog rasta uslovljenog mozda i najvecim tehnoloskim bumom jos od vatre i tocka. dok je period od par hiljada godina pre toga, bio period stagnacije i sporog ekonomskog rasta. 


Ako ima podatke i ekstrapolacije koje sezu do 0 A.D., nije mi jasno zasto je u fokusu kapitalizam.

drustveno raslojavanje je bilo jedan od uzrocnika politickih kriza i u grckim grad-drzavama, vekovima B.C. ali je Kapitalizam zahvalna i aktuelna tema.

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leri samers o knjizi:

The Inequality Puzzle

Thomas Piketty’s tour de force analysis doesn’t get everything right, but it’s certainly gotten us pondering the right questions.

Lawrence H. Summers

Once in a great while, a heavy academic tome dominates for a time the policy debate and, despite bristling with footnotes, shows up on the best-seller list. Thomas Piketty’s Capital in the Twenty-First Century is such a volume. As with Paul Kennedy’s The Rise and Fall of the Great Powers, which came out at the end of the Reagan Administration and hit a nerve by arguing the case against imperial overreach through an extensive examination of European history, Piketty’s treatment of inequality is perfectly matched to its moment.

Like Kennedy a generation ago, Piketty has emerged as a rock star of the policy-intellectual world. His book was for a time Amazon’s bestseller. Every pundit has expressed a view on his argument, almost always wildly favorable if the pundit is progressive and harshly critical if the pundit is conservative. Piketty’s tome seems to be drawn on a dozen times for every time it is read.

This should not be surprising. At a moment when our politics seem to be defined by a surly middle class and the President has made inequality his central economic issue, how could a book documenting the pervasive and increasing concentration of wealth and income among the top 1, .1, and .01 percent of households not attract great attention? Especially when it exudes erudition from each of its nearly 700 pages, drips with literary references, and goes on to propose easily understood laws of capitalism that suggest that the trend toward greater concentration is inherent in the market system and will persist absent the adoption of radical new tax policies.

Piketty’s timing may be impeccable, and his easily understandable but slightly exotic accent perfectly suited to today’s media; but make no mistake, his work richly deserves all the attention it is receiving. This is not to say, however, that all of its conclusions will stand up to scholarly criticism from his fellow economists in the short run or to the test of history in the long run. Nor is it to suggest that his policy recommendations are either realistic or close to complete as a menu for addressing inequality.

Start with its strengths. In many respects, Capital in the Twenty-First Century embodies the virtues that we all would like to see but find too infrequently in the work of academic economists. It is deeply grounded in painstaking empirical research. Piketty, in collaboration with others, has spent more than a decade mining huge quantities of data spanning centuries and many countries to document, absolutely conclusively, that the share of income and wealth going to those at the very top—the top 1 percent, .1 percent, and .01 percent of the population—has risen sharply over the last generation, marking a return to a pattern that prevailed before World War I. There can now be no doubt that the phenomenon of inequality is not dominantly about the inadequacy of the skills of lagging workers. Even in terms of income ratios, the gaps that have opened up between, say, the top .1 percent and the remainder of the top 10 percent are far larger than those that have opened up between the top 10 percent and average income earners. Even if none of Piketty’s theories stands up, the establishment of this fact has transformed political discourse and is a Nobel Prize-worthy contribution.

Piketty provides an elegant framework for making sense of a complex reality. His theorizing is bold and simple and hugely important if correct. In every area of thought, progress comes from simple abstract paradigms that guide later thinking, such as Darwin’s idea of evolution, Ricardo’s notion of comparative advantage, or Keynes’s conception of aggregate demand. Whether or not his idea ultimately proves out, Piketty makes a major contribution by putting forth a theory of natural economic evolution under capitalism. His argument is that capital or wealth grows at the rate of return to capital, a rate that normally exceeds the economic growth rate. Thus, economies will tend to have ever-increasing ratios of wealth to income, barring huge disturbances like wars and depressions. Since wealth is highly concentrated, it follows that inequality will tend to increase without bound until a policy change is introduced or some kind of catastrophe interferes with wealth accumulation.

Piketty writes in the epic philosophical mode of Keynes, Marx, or Adam Smith rather than in the dry, technocratic prose of most contemporary academic economists. His pages are littered with asides referencing Jane Austen, the works of Balzac, and many other literary figures. For those who don’t like or trust economics and economists, Piketty’s humane and urbane learning makes his analysis that much more compelling. As well it should: The issues of fairness of market outcomes that he deals with are best thought of as part of a broad contemplation of our society rather than in narrow numerical terms.

All of this is more than enough to justify the rapturous reception accorded Piketty in many quarters. But recall that Kennedy seemed to hit the zeitgeist perfectly but turned out later to have missed his mark as the Berlin Wall fell and the United States enjoyed an economic renaissance in the decade after he wrote; similarly, I have serious reservations about Piketty’s theorizing as a guide to understanding the evolution of American inequality. And, as even Piketty himself recognizes, his policy recommendations are unworldly—which could stand in the way of more feasible steps that could make a material difference for the middle class.

Piketty’s argument is straightforward, relying, as he says in his conclusion, on a simple inequality: r>g, in which the rate of return on capital exceeds the growth rate. Its essence is most easily grasped by thinking about population growth. Think first of a world where couples have four children. In that case, an accumulated fortune will dissipate, as the third generation of descendants has 64 members and the fourth has 256 members. On the other hand, if couples have only two children, a fortune has to be split only 16 ways even after four generations. So slow growth is especially conducive to rising levels of wealth inequality, as is a high rate of return on capital that accelerates wealth accumulation. Piketty argues that as long as the return to wealth exceeds an economy’s growth rate, wealth-to-income ratios will tend to rise, leading to increased inequality. According to Piketty, this is the normal state of capitalism. The middle of the twentieth century, a period of unprecedented equality, was also marked by wrenching changes associated with the Great Depression, World War II, and the rise of government, making the period from 1914 to 1970 highly atypical.

This rather fatalistic and certainly dismal view of capitalism can be challenged on two levels. It presumes, first, that the return to capital diminishes slowly, if at all, as wealth is accumulated and, second, that the returns to wealth are all reinvested. Whatever may have been the case historically, neither of these premises is likely correct as a guide to thinking about the American economy today.

Economists universally believe in the law of diminishing returns. As capital accumulates, the incremental return on an additional unit of capital declines. The crucial question goes to what is technically referred to as the elasticity of substitution. With 1 percent more capital and the same amount of everything else, does the return to a unit of capital relative to a unit of labor decline by more or less than 1 percent? If, as Piketty assumes, it declines by less than 1 percent, the share of income going to capital rises. If, on the other hand, it declines by more than 1 percent, the share of capital falls.

Economists have tried forever to estimate elasticities of substitution with many types of data, but there are many statistical problems. Piketty argues that the economic literature supports his assumption that returns diminish slowly (in technical parlance, that the elasticity of substitution is greater than 1), and so capital’s share rises with capital accumulation. But I think he misreads the literature by conflating gross and net returns to capital. It is plausible that as the capital stock grows, the increment of output produced declines slowly, but there can be no question that depreciation increases proportionally. And it is the return net of depreciation that is relevant for capital accumulation. I know of no study suggesting that measuring output in net terms, the elasticity of substitution is greater than 1, and I know of quite a few suggesting the contrary.

There are other fragmentary bits of evidence supporting this conclusion that come from looking at particular types of capital. Consider the case of land. In countries where land is scarce, like Japan or the United Kingdom, land rents represent a larger share of income than in countries like the United States or Canada, where it is abundant. Or consider the case of housing. Economists are quite confident that the demand for housing is inelastic, so that as more housing is created, prices fall more than proportionally—a proposition painfully illustrated in 2007 and 2008.

Does not the rising share of profits in national income in most industrial countries over the last several decades prove out Piketty’s argument? Only if one assumes that the only factors at work are the ones he emphasizes. Rather than attributing the rising share of profits to the inexorable process of wealth accumulation, most economists would attribute both it and rising inequality to the working out of various forces associated with globalization and technological change. For example, mechanization of what was previously manual work quite obviously will raise the share of income that comes in the form of profits. So does the greater ability to draw on low-cost foreign labor.

There is also the question of whether the returns to wealth are largely reinvested. A central claim by Piketty is that a country’s wealth-income ratio tends toward s/g, the ratio of its savings rate to its growth rate. Hence, as he argues, a declining growth rate leads to a higher wealth ratio. But this presumes a constant or rising saving ratio. Since he imagines returns to capital as largely reinvested, he finds this a plausible assumption.

I am much less sure. At the simplest level, consider a family with current income of 100 and wealth of 100 as opposed to a family with current income of 100 and wealth of 500. One would expect the former family to have a considerably higher saving ratio. In other words, there is a self-correcting tendency Piketty abstracts from whereby rising wealth leads to declining saving.

The largest single component of capital in the United States is owner-occupied housing. Its return comes in the form of the services enjoyed by the owners—what economists call “imputed rent”—which are all consumed rather than reinvested since they do not take a financial form. The phenomenon is broader. The determinants of levels of consumer spending have been much studied by macroeconomists. The general conclusion of the research is that an increase of $1 in wealth leads to an additional $.05 in spending. This is just enough to offset the accumulation of returns that is central to Piketty’s analysis.

A brief look at the Forbes 400 list also provides only limited support for Piketty’s ideas that fortunes are patiently accumulated through reinvestment. When Forbes compared its list of the wealthiest Americans in 1982 and 2012, it found that less than one tenth of the 1982 list was still on the list in 2012, despite the fact that a significant majority of members of the 1982 list would have qualified for the 2012 list if they had accumulated wealth at a real rate of even 4 percent a year. They did not, given pressures to spend, donate, or misinvest their wealth. In a similar vein, the data also indicate, contra Piketty, that the share of the Forbes 400 who inherited their wealth is in sharp decline.

But if it is not at all clear that there is any kind of iron law of capitalism that leads to rising wealth and income inequality, the question of how to account for rising inequality remains. After Piketty and his colleagues’ work, there can never again be a question about the phenomenon or its pervasiveness. The share of the top 1 percent of American income recipients has risen from below 10 percent to above 20 percent in some recent years. More than half of the income gains enjoyed by Americans in the twenty-first century have gone to the top 1 percent. The only groups that have outpaced the top 1 percent have been the top .1 and .01 percent.

Piketty, being a meticulous scholar, recognizes that at this point the gains in income of the top 1 percent substantially represent labor rather than capital income, so they are really a separate issue from processes of wealth accumulation. The official data probably underestimate this aspect—for example, some large part of Bill Gates’s reported capital income is really best thought of as a return to his entrepreneurial labor.

So why has the labor income of the top 1 percent risen so sharply relative to the income of everyone else? No one really knows. Certainly there have been changes in prevailing mores regarding executive compensation, particularly in the English-speaking world. It is conceivable, as Piketty argues, that as tax rates have fallen, executives have gone to more trouble to bargain for super high salaries, effort that would not have been worthwhile when tax rates were high (though I think it is equally plausible that higher tax rates would pressure executives to extract more, so as to maintain their post-tax income levels).

There is plenty to criticize in existing corporate-governance arrangements and their lack of resistance to executive self-dealing. There are certainly abuses. I think, however, that those like Piketty who dismiss the idea that productivity has anything to do with compensation should be given a little pause by the choices made in firms where a single hard-nosed owner is in control. The executives who make the most money are not for most part the ones running public companies who can pack their boards with friends. Rather, they are the executives chosen by private equity firms to run the companies they control. This is not in any way to ethically justify inordinate compensation—only to raise a question about the economic forces that generate it.

The rise of incomes of the top 1 percent also reflects the extraordinary levels of compensation in the financial sector. While anyone looking at the substantial resources invested in trading faster by nanoseconds has to worry about the over-financialization of the economy, much of the income earned in finance does reflect some form of pay for performance; investment managers are, for example, compensated with a share of the returns they generate.

And there is the basic truth that technology and globalization give greater scope to those with extraordinary entrepreneurial ability, luck, or managerial skill. Think about the contrast between George Eastman, who pioneered fundamental innovations in photography, and Steve Jobs. Jobs had an immediate global market, and the immediate capacity to implement his innovations at very low cost, so he was able to capture a far larger share of their value than Eastman. Correspondingly, while Eastman’s innovations and their dissemination through the Eastman Kodak Co. provided a foundation for a prosperous middle class in Rochester for generations, no comparable impact has been created by Jobs’s innovations.

This type of scenario is pervasive. Most obviously, the best athletes and entertainers benefit from a worldwide market for their celebrity. But something similar is true for those with extraordinary gifts of any kind. For example, I suspect we will soon see the rise of educator superstars who command audiences of hundreds of thousands for their Internet courses and earn sums way above the traditional dreams of academics.

Even where capital accumulation is concerned, I am not sure that Piketty’s theory emphasizes the right aspects. Looking to the future, my guess is that the main story connecting capital accumulation and inequality will not be Piketty’s tale of amassing fortunes. It will be the devastating consequences of robots, 3-D printing, artificial intelligence, and the like for those who perform routine tasks. Already there are more American men on disability insurance than doing production work in manufacturing. And the trends are all in the wrong direction, particularly for the less skilled, as the capacity of capital embodying artificial intelligence to replace white-collar as well as blue-collar work will increase rapidly in the years ahead.

Where does this leave policy?

Piketty’s argument is that a tendency toward wealth accumulation and concentration is an inevitable byproduct of the workings of the capitalist system. From his perspective, differences between capitalism as practiced in the English-speaking world and in continental Europe are of second order relative to the underlying forces at work. So he is led to far-reaching policy proposals as the principal redress for rising inequality.

In particular, Piketty argues for an internationally enforced progressive wealth tax, where the rate of tax rises with the level of wealth. This idea has many problems, starting with the fact that it is unimaginable that it will be implemented any time soon. Even with political will, there are many problems of enforcement. How does one value a closely held business? Even if a closely held business could be accurately valued, will its owners be able to generate the liquidity necessary to pay the tax? Won’t each jurisdiction have a tendency to undervalue assets within it as a way of attracting investment? Will a wealth tax encourage unseemly consumption by the wealthy?

Perhaps the best way of thinking about Piketty’s wealth tax is less as a serious proposal than as a device for pointing up two truths. First, success in combating inequality will require addressing the myriad devices that enable those with great wealth to avoid paying income and estate taxes. It is sobering to contemplate that in the United States, annual estate and gift tax revenues come to less than 1 percent of the wealth of just the 400 wealthiest Americans. With respect to taxation, as so much else in life, the real scandal is not the illegal things people do—it is the things that are legal. And second, such efforts are likely to require international cooperation if they are to be effective in a world where capital is ever more mobile. The G-20 nations working through the OECD have begun to address these issues, but there is much more that can be done. Whatever one’s views on capital mobility generally, there should be a consensus on much more vigorous cooperative efforts to go after its dark side—tax havens, bank secrecy, money laundering, and regulatory arbitrage.

Beyond taxation, however, there is, one would hope, more than Piketty acknowledges that can be done to make it easier to raise middle-class incomes and to make it more difficult to accumulate great fortunes without requiring great social contributions in return. Examples include more vigorous enforcement of antimonopoly laws, reductions in excessive protection for intellectual property in cases where incentive effects are small and monopoly rents are high, greater encouragement of profit-sharing schemes that benefit workers and give them a stake in wealth accumulation, increased investment of government pension resources in riskier high-return assets, strengthening of collective bargaining arrangements, and improvements in corporate governance. Probably the two most important steps that public policy can take with respect to wealth inequality are the strengthening of financial regulation to more fully eliminate implicit and explicit subsidies to financial activity, and an easing of land-use restrictions that cause the real estate of the rich in major metropolitan areas to keep rising in value.

Hanging over this subject is a last issue. Why is inequality so great a concern? Is it because of the adverse consequences of great fortunes or because of the hope that middle-class incomes could grow again? If, as I believe, envy is a much less important reason for concern than lost opportunity, great emphasis should shift to policies that promote bottom-up growth. At a moment when secular stagnation is a real risk, such policies may include substantially increased public investment and better training for young people and retraining for displaced workers, as well as measures to reduce barriers to private investment in spheres like energy production, where substantial job creation is possible.

Look at Kennedy airport. It is an embarrassment as an entry point to the leading city in the leading country in the world. The wealthiest, by flying privately, largely escape its depredations. Fixing it would employ substantial numbers of people who work with their hands and provide a significant stimulus to employment and growth. As I’ve written previously, if a moment when the United States can borrow at lower than 3 percent in a currency we print ourselves, and when the unemployment rate for construction workers hovers above 10 percent, is not the right moment to do it, when will that moment come?

Books that represent the last word on a topic are important. Books that represent one of the first words are even more important. By focusing attention on what has happened to a fortunate few among us, and by opening up for debate issues around the long-run functioning of our market system, Capital in the Twenty-First Century has made a profoundly important contribution.

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Nisam imao jos vremena da procitam knjigu ali dosadasnji utisci su:

- mnogo bolja i sveobuhvatnija knjiga od onoga sto se inace moze procitati od mejnstrim ekonomista

- glavna teza da kapitalizam u praksi stvara i pojacava nejednakosti za mene ni pre ni posle citanja nece biti sporna

- za mene su sporna resenja koja se uglavnom bave simptomima a ne i uzrocima toga zasto je sistem ovakav kakav je

- za levicarske ekonomiste i uopste ideologe bi bilo mnogo korisnije da se detaljno bave mehanizmima koji stvaraju nejednakost i smisle nesto novo osim nacionalizacije ili astronomskih poreza

Edited by Anduril
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 (Gejts, Pejdž, Brin, Bafet, Blumberg, itd.


Uzmimo ovu grupu ultra-bogatih.

Kako su se oni obogatili?

Uglavnom monopolom putem patenanta (prva tri) i masivnom pozitivnom diskriminacijom koju uziva trgovina akcijama i kapitalom u odnosu na druge oblike trgovine. 


Prema tome, kapitalizam stvara nejednakost ali cesto u talu sa politickim sistemom koji kreira pravila igre.

Problem nije toliko u kapitalizmu ili cak socijalzmu, nego mnogo vise kako stvoriti politicki sistem koji je relativno imun na lobiranje i definisanje pravila igre od strane ekonomski jacih.

Edited by Anduril
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Nisam imao jos vremena da procitam knjigu ali dosadasnji utisci su:

- mnogo bolja i sveobuhvatnija knjiga od onoga sto se inace moze procitati od mejnstrim ekonomista

- glavna teza da kapitalizam u praksi stvara i pojacava nejednakosti za mene ni pre ni posle citanja nece biti sporna

- za mene su sporna resenja koja se uglavnom bave simptomima a ne i uzrocima toga zasto je sistem ovakav kakav je

- za levicarske ekonomiste i uopste ideologe bi bilo mnogo korisnije da se detaljno bave mehanizmima koji stvaraju nejednakost i smisle nesto novo osim nacionalizacije ili astronomskih poreza


zapravo se slazem ali vise za koji dan. danasnji dan mi je bio cudan.

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Uzmimo ovu grupu ultra-bogatih.

Kako su se oni obogatili?

Uglavnom monopolom putem patenanta (prva tri) i masivnom pozitivnom diskriminacijom koju uziva trgovina akcijama i kapitalom u odnosu na druge oblike trgovine.


Patenti na softver koliko znam nisu bili mogući u Gejtsovo vreme (koji se btw obogatio i pored masovne piraterije MS proizvoda), dok je Gugl (Pejdž i Brin) uglavnom zarađivao (i zarađuje) na reklamama.


Svejedno, poenta je bila u tome da gorenavedeni nisu nasledili bogatstvo, već su ga napravili.

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patent za page rank je u vlasnistvu stanforda, ali ga je google iznajmio po povoljnijim cenama od onog sto su mogli da dobiju drugi. tako da jesu uzivali u patentnoj zastiti, iako nisu direktno prodavali patentiran softver. kolika bi bila razlika na koncentirasnje / raspodelu i stvaranje bogastva da page rank nije patentiran tesko je reci.

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Koliko vidim nije ga Gugl iznajmio povoljnije nego sto su mogli drugi nego ima ekskluzivno pravo na koriscenje patenta. A to pravo pre svega proizilazi iz cinjenice da su PageRank izmisili Brin i Pejdz radeci za Stanford.


Sto se tice presudnosti patentne zastite - u ovom slucaju da nije postojao patent kao pravna zastita, algoritam verovatno jednostavno ne bi bio objavljen (ili bi bio objavljen u dovoljno osakacenom obliku da se ne moze reprodukovati), vec bi se islo direktno na pravljenje spin-off kompanije i komercijalizacije (gde bi Stanford dobio svoj deo). I pre patenata postojale su poslovne tajne (s razlogom), a postoje bogami i danas.


I naravno da je nemoguce reci - ima toliko patenata koji sede neiskorisceni pa se njihov potencijal realizuje tek kada patent istece ili kada se proda (cesto po bagatelnoj ceni) nekoj drugoj firmi. Pre PageRank-a postojao je RankDex, vrlo slican (takodje patentiran kasnije), koji nije napravio svetski bum kao i kad i Gugl, nego se tek kasnije razvio u internet supersilu pod imenom Baidu (tzv. "kineski gugl"). Takodje, s obzirom da ovde govorimo o patentu iskoriscenom od strane neposrednih izumitelja, pitanje je da li bi u tom trenutku iko osim njih samih i njihovih bliskih saradnika toliko dobro implementirao i komercijalizovao PageRank. Sve i da patenta nije bilo, nesto sumnjam da bi Gugl svakodnevno stavljao na internet sav svoj softverski kod i otkrivao sve svoje tajne i cake. Mislim da nije daleko od istine ako se kaze da su tu licno umece (naucno, inzenjersko, preduzetnicko) i osecaj za proizvod/uslugu i trenutak da se to plasira (uz naravno dosta srece) bili daleko presudniji nego cinjenica da je postojao patent.

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