Challenging the Empirical Contribution of Thomas Piketty's Capital in the 21st Century
Phillip W. Magness
George Mason University - Institute for Humane Studies; George Mason University - School of Policy, Government, and International Affairs
Robert P. Murphy
Institute for Energy Research
December 26, 2014
Journal of Private Enterprise, Spring 2015
GMU School of Public Policy Research Paper No. 15-2
Thomas Piketty's Capital in the 21st Century has been widely debated on theoretical grounds, yet continues to attract acclaim for its historically-infused data analysis. In this study we conduct a closer scrutiny of Piketty's empirics than has appeared thus far, focusing upon his treatment of the United States. We find 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 20th century. Taken together, these problems suggest that Piketty’s highly praised and historically-driven empirical work may actually be one of the book’s greatest weaknesses.
Number of Pages in PDF File: 43
Keywords: Thomas Piketty, Capital in the 21st Century, Inequality
JEL Classification: N01, N10, D31, D63
Date posted: December 28, 2014 ; Last revised: February 13, 2015
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