Piketty’s Inequality Con
29th March 2024
While Piketty’s claims about the desirability of egalitarianism and wealth taxes are to some extent subjective, his book and his reputation are premised on the claim that he carefully assembled data that showed an increasing return to capital over time.
He claims to have based his work on three centuries of data.
Unfortunately, for fans of Piketty and left-wing economists who prefer a more fact-based economics approach, it looks like Piketty’s data work is quite sloppy.
In 2015, Magness and Murphy pointed to a wide range of flaws or mistakes in the book writing that they found “evidence of pervasive errors of historical fact, opaque methodological choices, and the cherry-picking of sources to construct favorable patterns from ambiguous data. Additional evidence suggests that Piketty used a highly distortive data assumption from the Soviet Union to accentuate one of his main historical claims about global “capitalism” in the twentieth century.” According to Magness and Murphy, Piketty bases his measure of 150 years of the world economy on a sample size of just six individual years and just extrapolates the rest of the data! Yikes!