This is a rather lengthy

trkingmomoe — Thu, 17 Apr 2014 02:06:45 +0000

In reply to Why We’re in a New Gilded Age

This is a rather lengthy review but the book is over 600 pages, but Krugman is very readable even when he is being technical. This is one of the important points he makes from the research.

To be sure, this is a race that can have no permanent victor: over the very long run, the stock of capital and total income must grow at roughly the same rate. But one side or the other can pull ahead for decades at a time. On the eve of World War I, Europe had accumulated capital worth six or seven times national income. Over the next four decades, however, a combination of physical destruction and the diversion of savings into war efforts cut that ratio in half. Capital accumulation resumed after World War II, but this was a period of spectacular economic growth—the Trente Glorieuses, or “Glorious Thirty” years; so the ratio of capital to income remained low. Since the 1970s, however, slowing growth has meant a rising capital ratio, so capital and wealth have been trending steadily back toward Belle Époque levels. And this accumulation of capital, says Piketty, will eventually recreate Belle Époque–style inequality unless opposed by progressive taxation.

dagblog - Comments for "Why We’re in a New Gilded Age"

This is a rather lengthy