Thomas Piketty Quotes & Sayings

There is a fundamentalist belief by capitalists that capital will save the world, and it just isn't so. — Thomas Piketty

These findings stand in sharp contrast to the belief in "American exceptionalism" that once dominated US sociology, according to which social mobility in the United States was exceptionally high compared with the class-bound societies of Europe. No doubt the settler society of the early nineteenth century was more mobile. As I have shown, moreover, inherited wealth played a smaller role in the United States than in Europe, and US wealth was for a long time less concentrated, at least up to World War I. Throughout most of the twentieth century, however, and still today, the available data suggest that social mobility has been and remains lower in the United States than in Europe. — Thomas Piketty

What is most frightening about Vautrin's lecture is that his brisk portrait of Restoration society contains such precise figures. As I will soon show, the structure of the income and wealth hierarchies in nineteenth-century France was such that the standard of living the wealthiest French people could attain greatly exceeded that to which one could aspire on the basis of income from labor alone. Under such conditions, why work? And why behave morally at all? Since social inequality was in itself immoral and unjustified, why not be thoroughly immoral and appropriate capital by whatever means are available? The — Thomas Piketty

We know too little about global wealth dynamics, so we need international transmission of bank information. — Thomas Piketty

One way to have broader access to wealth is to reduce the tax on the large group and increase the tax on the very top so concentration of wealth doesn't get to extreme levels. — Thomas Piketty

The social sciences collectively know too little to waste time on foolish disciplinary squabbles. — Thomas Piketty

The right solution is a progressive annual tax on capital. This will make it possible to avoid an endless inegalitarian spiral while preserving competition and incentives for new instances of primitive accumulation. — Thomas Piketty

There is no escaping the fact, however, that social science research on the distribution of wealth was for a long time based on a relatively limited set of firmly established facts together with a wide variety of purely theoretical speculations. — Thomas Piketty

The only way to overcome these contradictions is for the countries of the Eurozone (or at any rate those who are willing) to pool their public debts. — Thomas Piketty

When you are an entrepreneur, you have founded your own firm, it is so easy to find that you exist - you are the main shareholder of your company; it is very easy to look at the stock market position of your company to know how rich you are. — Thomas Piketty

Modern redistribution is built around a logic of rights and a principle of equal access to a certain number of goods deemed to be fundamental. — Thomas Piketty

The Marikana tragedy calls to mind earlier instances of violence. At Haymarket Square in Chicago on May 1, 1886, and then at Fourmies, in northern France, on May 1, 1891, police fired on workers striking for higher wages. Does this kind of violent clash between labor and capital belong to the past, or will it be an integral part of twenty-first-century history? — Thomas Piketty

monopsony" rather than monopoly), in which case the owner of capital can impose a rate of return greater than the marginal productivity of his capital. — Thomas Piketty

I don't think there is any serious evidence that we need to be paying people more than 100 times the average wage in order to get high-performing managers. — Thomas Piketty

When inequality gets too extreme, then it becomes useless for growth, and it can even become bad because it tends to lead to high perpetuation of inequality over time and low mobility. — Thomas Piketty

Conversely, younger people, in particular those born in the 1970s and 1980s, have already experienced (to a certain extent) the important role that inheritance will once again play in their lives and the lives of their relatives and friends. For this group, for example, whether or not a child receives gifts from parents can have a major impact in deciding who will own property and who will not, at what age, and how extensive that property will be - in any case, to a much greater extent than in the previous generation. Inheritance is playing a larger part in their lives, careers, and individual and family choices than it did with the baby boomers. — Thomas Piketty

I was born too late to have any temptation with communism, or at least Soviet-type communism. Travelling in Eastern Europe and the ex-Soviet Union, you clearly don't want to defend a system that would have empty shops and a totalitarian regime and internal passports. — Thomas Piketty

Progress in medicine together with improved living conditions has therefore, it is argued, totally transformed the very essence of capital. — Thomas Piketty

Economists should be modest and be aware that they are part of the broader social science community. We need to be pragmatic about the methods we use. When we need to do history, we should do history. When we need to study political science, we should study political science. — Thomas Piketty

(which did not exist before the creation of the income tax in 1913) — Thomas Piketty

Yeah, I am in favor of migration. But I am also in favor of education. But at the same time, I am in favor of progressive taxation. I think we need all of this. I think we don't have to choose one. — Thomas Piketty

It's important to realize that innovation and growth in itself are not sufficient to moderate inequality of wealth. — Thomas Piketty

As long as the incomes of the various classes of contemporary society remain beyond the reach of scientific inquiry, there can be no hope of producing a useful economic and social history. — Thomas Piketty

The democratic ideal has always been related to a moderate level of inequality. I think one big reason why electoral democracy flourished in 19th century America better than 19th century Europe is because you had more equal distribution of wealth in America. — Thomas Piketty

I'm not as pessimistic as what a number of people seem to believe. — Thomas Piketty

The only continent not in equilibrium is Africa, where a substantial share of capital is owned by foreigners. — Thomas Piketty

the higher returns of the largest endowments are not due primarily to greater risk taking but to a more sophisticated investment strategy that consistently produces better results. — Thomas Piketty

It is not out of the question that the two forces of divergence will ultimately come together in the twenty-first century. This has already happened to some extent and may yet become a global phenomenon, which could lead to levels of inequality never before seen, as well as to a radically new structure of inequality. Thus far, however, these striking patterns reflect two distinct underlying phenomena. — Thomas Piketty

Once constituted, capital reproduces itself faster than output increases. The past devours the future. — Thomas Piketty

Capitalism and market forces are very powerful in producing wealth and innovation. But we need to ensure that these forces act in the common interest. — Thomas Piketty

To be sure, there exists in principle a quite simple economic mechanism that should restore equilibrium to the process: the mechanism of supply and demand. If the supply of any good is insufficient, and its price is too high, then demand for that good should decrease, which should lead to a decline in its price. In other words, if real estate and oil prices rise, then people should move to the country or take to traveling about by bicycle (or both). Never mind that such adjustments might be unpleasant or complicated; they might also take decades, during which landlords and oil well owners might well accumulate claims on the rest of the population so extensive that they could easily come to own everything that can be owned, including rural real estate and bicycles, once and for all.3 As always, the worst is never certain to arrive. It is much too soon to warn readers that by 2050 they may be paying rent to the emir of Qatar. — Thomas Piketty

the income of nonwage workers is "mixed," because it combines income from labor with income from capital. This is also referred to as "entrepreneurial income. — Thomas Piketty

tax is always more than just a tax: it is also a way of defining norms and categories and imposing a legal framework on economic activity. — Thomas Piketty

Wealth is so concentrated that a large segment of society is virtually unaware of its existence. — Thomas Piketty

the baby boom cohorts had to make it on their own, almost as much as the interwar and turn-of-the-century cohorts, who were devastated by war. By contrast, the cohorts born in the last third of the century experienced the powerful influence of inherited wealth to almost the same degree as the cohorts of the nineteenth and twenty-first centuries. — Thomas Piketty

Housing is the favorite investment of the middle class and moderately well-to-do, but true wealth always consists primarily of financial and business assets. — Thomas Piketty

If the twenty-first century turns out to be a time of low (demographic and economic) growth and high return on capital (in a context of heightened international competition for capital resources), or at any rate in countries where these conditions hold true, inheritance will therefore probably again be as important as it was in the nineteenth century. An evolution in this direction is already apparent in France and a number of other European countries, where growth has already slowed considerably in recent decades. For the moment it is less prominent in the United States, essentially because demographic growth there is higher than in Europe. But if growth ultimately slows more or less everywhere in the coming century, as the median demographic forecasts by the United Nations (corroborated by other economic forecasts) suggest it will, then inheritance will probably take on increased importance throughout the world. — Thomas Piketty

The history of inequality is shaped by the way economic, social, and political actors view what is just and what is not, as well as by the relative power of those actors and the collective choices that result. It is the joint product of all relevant actors combined. — Thomas Piketty

Having a decent share of the national wealth for the middle class is not bad for growth. It is actually useful both for equity and efficiency reasons. — Thomas Piketty

In 1860, the average price of a male slave of prime working age was roughly $2,000, whereas the average wage of a free farm laborer was on the order of $200. — Thomas Piketty

showed that even with the considerable increase in the average level of education over the course of the twentieth century, earned income inequality did not decrease. Qualification levels shifted upward: a high school diploma now represents what a grade school certificate used to mean, a college degree what a high school diploma used to stand for, and so on. — Thomas Piketty

Contrary to a tenacious myth, France is not owned by California pension funds or the Bank of China, any more than the United States belongs to Japanese and German investors. The fear of getting into such a predicament is so strong today that fantasy often outstrips reality. The reality is that inequality with respect to capital is a far greater domestic issue than it is an international one. — Thomas Piketty

There is also the idea, widespread among economists, that modern economic growth depends largely on the rise of "human capital." At first glance, this would seem to imply that labor should claim a growing share of national income. And one does indeed find that there may be a tendency for labor's share to increase over the very long run, but the gains are relatively modest: — Thomas Piketty

Over a long period of time, the main force in favor of greater equality has been the diffusion of knowledge and skills. — Thomas Piketty

Economists tend to think they are much, much smarter than historians, than everybody. And this is a bit too much because at the end of the day, we don't know very much in economics. — Thomas Piketty

in wartime, economic activity decreases, inflation increases, and real wages and purchasing power begin to fall. Wages at the bottom of the wage scale generally rise, however, and are somewhat more generously protected from inflation than those at the top. — Thomas Piketty

You need some inequality to grow ... but extreme inequality is not only useless but can be harmful to growth because it reduces mobility and can lead to political capture of our democratic institutions. — Thomas Piketty

In the top centile, by contrast, financial and business assets clearly predominate over real estate. In particular, shares of stock or partnerships constitute nearly the totality of the largest fortunes. Between 2 and 5 million euros, the share of real estate is less than one-third; above 5 million euros, it falls below 20 percent; above 10 million euros, it is less than 10 percent and wealth consists primarily of stock. — Thomas Piketty

I belong to a generation that came of age listening to news of the collapse of the Communist dicatorships and never felt the slightest affection or nostalgia for those regimes or for the Soviet Union. I was vaccinated for life against the conventional but lazy rhetoric of anticapitalism, some of which simply ignored the historic failure of Communism and much of which turned its back on the intellectual means necessary to push beyond it. I have no interest in denouncing inequality or capitalism per se - especially since social inequalities are not in themselves a problem as long as they are justified, that is, "founded only upon common utility," as article 1 of the 1789 Declaration of the Rights of Man and the Citizen proclaims. — Thomas Piketty

The United States could transform its property tax system into a progressive tax on net worth without asking permission to the rest of the world. — Thomas Piketty

Income inequality increased quite sharply in the United States during the 1920s, however, peaking on the eve of the 1929 crash with more than 50 percent of national income going to the top decile - — Thomas Piketty

Refusing to deal with numbers rarely serves the interests of the least well-off. — Thomas Piketty

Indeed, the distribution of wealth is too important an issue to be left to economists, sociologists, historians, and philosophers. — Thomas Piketty

the upper classes instinctively abandoned idleness and invented meritocracy lest universal suffrage deprive them of everything they owned. — Thomas Piketty

The principal mechanism for convergence at the international as well as the domestic level is the diffusion of knowledge. — Thomas Piketty

What I'm pushing for is an economic discipline that will be closer to other social sciences; in particular, we should be more pragmatic about the methods that we are using instead of pretending that we have our own scientific apparatus with very sophisticated mathematic models that distinguish us from sociologists and historians. — Thomas Piketty

always increasing and that the world is by definition always becoming more unjust. Others believe that inequality is naturally decreasing, or that harmony comes about automatically, and that in any case nothing should be done that might risk disturbing this happy equilibrium. Given this dialogue of the deaf, in which each camp justifies its — Thomas Piketty

When a country goes from a population of 3 million to a population of 300 million (to say nothing of the radical increase in territory owing to westward expansion in the nineteenth century), it is clearly no longer the same country. — Thomas Piketty

Without precisely defined sources, methods, and concepts, it is possible to see absolutely everything and its opposite. — Thomas Piketty

the decrease in the top marginal income tax rate led to an explosion of very high incomes, which then increased the political influence of the beneficiaries of the change in the tax laws, who had an interest in keeping top tax rates low or even decreasing them further and who could use their windfall to finance political parties, pressure groups, and think tanks. — Thomas Piketty

When it comes to decreasing inequalities of wealth for good or reducing unusually high levels of public debt, a progressive tax on capital is generally a better tool than inflation. — Thomas Piketty

One can even imagine that inflation tends to improve the relative position of the wealthiest individuals compared to the least wealthy, in that it enhances the importance of financial managers and intermediaries. A person with 10 or 50 million euros cannot afford the money managers that Harvard has but can nevertheless pay financial advisors and stockbrokers to mitigate the effects of inflation. By contrast, a person with only 10 or 50 thousand euros to invest will not be offered the same choices by her broker (if she has one): contacts with financial advisors are briefer, and many people in this category keep most of their savings in checking accounts that pay little or nothing and/or savings accounts that pay little more than the rate of inflation. — Thomas Piketty

For industrial goods, productivity growth has been more rapid than for the economy as a whole, so that prices in this sector have fallen relative to the average of all prices. Foodstuffs is a sector in which productivity has increased continuously and crucially over the very long run (thereby allowing a greatly increased population to be fed by ever fewer hands, liberating a growing portion of the workforce for other tasks), even though the increase in productivity has been less rapid in the agricultural sector than in the industrial sector, so that food prices have evolved at roughly the same rate as the average of all prices. Finally, productivity growth in the service sector has generally been low (or even zero in some cases, which explains why this sector has tended to employ a steadily increasing share of the workforce), so that the price of services has increased more rapidly than the average of all prices. — Thomas Piketty

And in the most inegalitarian countries, such as the United States in the early 2010s (where, as will emerge later, income from labor is about as unequally distributed as has ever been observed anywhere), the top decile gets 35 percent of the total, whereas the bottom half gets only 25 percent. — Thomas Piketty

political democracies that do not democratize their economic systems are inherently unstable. — Thomas Piketty

One should be wary, however, of the conventional wisdom that modern economic growth is a marvelous instrument for revealing individual talents and aptitudes. There is some truth in this view, but since the early nineteenth century it has all too often been used to justify inequalities of all sorts, no matter how great their magnitude and no matter what their real causes may be, while at the same time gracing the winners in the new industrial economy with every imaginable virtue. — Thomas Piketty

The reality was so striking that it even found expression in an animated cartoon, The Aristocats, set in Paris in 1910. The size of the old lady's fortune is not mentioned, but to judge by the splendor of her residence and by the zeal of her butler Edgar to get rid of Duchesse and her three kittens, it must have been considerable. — Thomas Piketty

Income from labor [in the United States] is about as unequally distributed as has ever been observed anywhere. — Thomas Piketty

For individuals whose only capital is a small balance in a checking account, the return is negative, because such balances yield no interest and are eaten away by inflation. Savings accounts often yield little more than the inflation rate. — Thomas Piketty

one would expect to see a flow of investments in Africa from other countries, especially China and other Asian nations. — Thomas Piketty

Our democratic societies rest on a meritocratic worldview, or at any rate a meritocratic hope, by which I mean a belief in a society in which inequality is based more on merit and effort than on kinship and rents. This belief and this hope play a very crucial role in modern society, for a simple reason: in a democracy, the professed equality of rights of all citizens contrasts sharply with the very real inequality of living conditions, and in order to overcome this contradiction it is vital to make sure that social inequalities derive from rational and universal principles rather than arbitrary contingencies. Inequalities must therefore be just and useful to all, at least in the realm of discourse and as far as possible in reality as well. — Thomas Piketty

I want to be clear that at this stage I am not making a judgment about whether a society of this kind really deserves to be characterized as "hypermeritocratic." It is hardly surprising that the winners in such a society would wish to describe the social hierarchy in this way, and sometimes they succeed in convincing some of the losers. — Thomas Piketty

Social scientific research is and always will be tentative and imperfect. It does not claim to transform economics, sociology, and history into exact sciences. But by patiently searching for facts and patterns and calmly analyzing the economic, social, and political mechanisms that might explain them, it can inform democratic debate and focus attention on the right questions. It can help to redefine the terms of debate, unmask certain preconceived or fraudulent notions, and subject all positions to constant critical scrutiny. In my view, this is the role that intellectuals, including social scientists, should play, as citizens like any other but with the good fortune to have more time than others to devote themselves to study (and even to be paid for it - a signal privilege). — Thomas Piketty

Goldin and Katz have no doubt that increased wage inequality in the United States is due to a failure to invest sufficiently in higher education. More precisely, too many people failed to receive the necessary training, in part because families could not afford the high cost of tuition. In order to reverse this trend, they conclude, the United States should invest heavily in education so that as many people as possible can attend college. — Thomas Piketty

taxes consumed less than 10 percent of national income in all four countries during the nineteenth century and up to World War I. This reflects the fact that the state at that time had very little involvement in economic and social life. — Thomas Piketty

'Das Kapital,' I think, is very difficult to read, and for me, it was not very influential. — Thomas Piketty

In the first place, just as income tax returns allow us to study changes in income inequality, estate tax returns enable us to study changes in the inequality of wealth. — Thomas Piketty

In contrast to what many people in Britain and the United States believe, the true figures on growth (as best one can judge from official national accounts data) show that Britain and the United States have not grown any more rapidly since 1980 than Germany, France, Japan, Denmark, or Sweden. In other words, the reduction of top marginal income tax rates and the rise of top incomes do not seem to have stimulated productivity (contrary to the predictions of supply-side theory) or at any rate did not stimulate productivity enough to be statistically detectable at the macro level. — Thomas Piketty

What I argue for is a progressive tax, a global tax, based on the taxation of private property. — Thomas Piketty

This leads to the idea of a race between education and technology: if the supply of skills does not increase at the same pace as the needs of technology, then groups whose training is not sufficiently advanced will earn less and be relegated to devalued lines of work, and inequality with respect to labor will increase. In order to avoid this, the educational system must increase its supply of new types of training and its output of new skills at a sufficiently rapid pace. If equality is to decrease, moreover, the supply of new skills must increase even more rapidly, especially for the least well educated. — Thomas Piketty

Autarky has never promoted prosperity. — Thomas Piketty

When the rate of return on capital significantly exceeds the growth rate of the economy (as it did through much of history until the nineteenth century and as is likely to be the case again in the twenty-first century), then it logically follows that inherited wealth grows faster than output and income. People — Thomas Piketty

I loved American universities. In many ways, they are better organized - certainly than French universities. — Thomas Piketty

wealth in the rich countries is currently divided into two approximately equal (or comparable) parts: real estate and financial assets. — Thomas Piketty

The dynamics of the global distribution of capital are at once economic, political, and military. This was already the case in the colonial era, when the great powers of the day, Britain and France foremost among them, were quick to roll out the cannon to protect their investments. Clearly, the same will be true in the twenty-first century, in a tense new global political configuration whose contours are difficult to predict in advance. — Thomas Piketty

Democracy will never be supplanted by a republic of experts - and that is a very good thing. — Thomas Piketty

The sharp reduction in income inequality that we observe in almost all the rich countries between 1914 and 1945 was due above all to the world wars and the violent economic and political shocks they entailed (especially for people with large fortunes). It had little to do with the tranquil process of intersectoral mobility described by Kuznets. — Thomas Piketty

By comparing various sources of data, moreover, it is possible to estimate that the average income of the parents of Harvard students is currently about $450,000, which corresponds to the average income of the top 2 percent of the US income hierarchy.32 Such a finding does not seem entirely compatible with the idea of selection based solely on merit. The contrast between the official meritocratic discourse and the reality seems particularly extreme in this case. The total absence of transparency regarding selection procedures should also be noted.33 — Thomas Piketty

The bad news (or good news, depending on your point of view) is that things have always been like this. — Thomas Piketty

We know something about billionaire consumption, but it is hard to measure some of it. Some billionaires are consuming politicians, others consume reporters, and some consume academics... — Thomas Piketty

What was the good of industrial development, what was the good of all the technological innovations, toil, and population movements if, after half a century of industrial growth, the condition of the masses was still just as miserable as before, and all lawmakers could do was prohibit factory labor by children under the age of eight? — Thomas Piketty

In all human societies, health and education have an intrinsic value: the ability to enjoy years of good health, like the ability to acquire knowledge and culture, is one of the fundamental purposes of civilization. — Thomas Piketty

We want capitalism and market forces to be the slave of democracy rather than the opposite. — Thomas Piketty

the function of the system of financial intermediation (banks and financial markets): to find the best possible uses for capital, such that each available unit of capital is invested where it is most productive (at the opposite ends of the earth, if need be) and pays the highest possible return to the investor. — Thomas Piketty

The main force pushing toward reduction in inequality has always been the diffusion of knowledge and the diffusion of education. — Thomas Piketty

My premise is not to tax to destroy the wealth of the wealthy; it's to increase the wealth of the bottom and the middle class. — Thomas Piketty

None of the Asian countries that have moved closer to the developed countries of the West in recent years has benefited from large foreign investments, whether it be Japan, South Korea, or Taiwan and more recently China. In essence, all of these countries themselves financed the necessary investments in physical capital and, even more, in human capital, which the latest research holds to be the key to long-term growth.35 Conversely, countries owned by other countries, whether in the colonial period or in Africa today, have been less successful, most notably because they have tended to specialize in areas without much prospect of future development and because they have been subject to chronic political instability. — Thomas Piketty

Everyone is political in his or her own way. — Thomas Piketty

When inequality gets to an extreme, it is completely useless for growth. — Thomas Piketty

For millions of people, "wealth" amounts to little more than a few weeks' wages in a checking account or low-interest savings account, a car, and a few pieces of furniture. The inescapable reality is this: wealth is so concentrated that a large segment of society is virtually unaware of its existence, so that some people imagine that it belongs to surreal or mysterious entities. That is why it is so essential to study capital and its distribution in a methodical, systematic way. — Thomas Piketty