Discussing Thomas Piketty's inequality treatise with Andrew Mazzone – video

Prompted by this critical review article of Professor Thomas Piketty’s Capitalism in the 21st Century, which I recently published in Real World Economics Review, Andrew Mazzone (of the Henry George School Social Science) kindly interviewed me on the subject of inequality and Professor Piketty’s book.



  • Piketty’s definition of Capital or Wealth is very clear and precise. It is wider than Marx’s because it includes land. Piketty explains that this is necessary for practical reasons (it can be measured more precisely) and theoretical reasons. In Marxist terms what matters is who can only sell his labour and who can hire labour. You can borrow on land or sell it and hire labour. Try to start a business without any property! Many cheap arguments have been made in English by ignoring Piketty’s clear definitions and using the word “wealth” in its everyday, very wide and ambiguous sense. The original French word that has been translated into English as “wealth” is “patrimoine”. It’s everyday meaning is close to Piketty’s definition of Capital or “Wealth”. It translates very well into modern Greek as “περιουσία”. Maybe some Anglo-American economists should start learning French … 🙂

  • I agree with you 100% on the theoretical part, but I think you are wrong on Piketty’s ambitions, he does want to change things. I think he is unhappy with his life. I met him in his office a couple of times to talk about inequalities, it was interesting but what struck me, is it’s like he has a black cloud over his head, all the time. He can talk about many things (he is not ignorant as you say) but at the same time it’s still his soul is somewhere else. He seems genuinely unhappy, deeply sad… couldn’t point my finger on why though.
    Soon after, someone told me he had issues with alcohol, and beat his wife (former french minister Aurélie Filipetti, with whom he has one kid), she pressed charges and left him. You can check about that. He is idealistic, very classical left wing, very bright but very sad, I can tell you.

    • Hi Ben,

      Following your post I did a search on Piketty & Filippetti relationship as I had no interest in his personal life. The articles that were posted by telegraph.co.uk & dailymail.co.uk use words like “Rock Star” Economist, “Neo-Marxist Economist Du Jour” and “the latest bright light of the dismal science to endure tabloid debasement arising from his sex life”. People who live their lives outside the economics profession or may not be familiar with Piketty’s work on inequality might get the wrong impression of what he is about thanks to the preoccupation of MSM with gossip and celebrity culture. We can thank Murdoch & his editors for this type of cultural toxicity.

  • Dear Yanni,

    I very much doubt that Nozick’s critique is broadly accepted as one which “destroyed John Rawls”. I certainly don’t buy it…
    Are you referring to some particular “consensus”, published or otherwise?

    • Well, I for one think that Nozick wiped the floor clean with Rawls… The (correct) argument that the only way we can maintain an income distribution arrived at behind Rawls’ veil of interest is by prohibiting consenting adults to transact with one another won the day. Static end-based theories of distributive justice (like Rawls’) are ever so easy to debunk. Nozick’s argument (which is, by the way, the same as Marx’s) that it is the process that matters (from a normative perspective) more than the outcome wins hands down. Or so I think. (The fact that Nozick’s own procedural theory of justice is full of holes is another matter.)

    • I see your point about static distributive theories being easy to debunk, but not by an argument such as Nozick or Marx offered.

      The apparent problem with static theories identified by all critics, is that they are put forth as one-off, holistic theories: “set the right rules at the beginning and let it run”. Alas, any freshman systems theorist will tell you the sorry outcome of a system without feedback. So, naturally, maintaining a desired distribution outcome does involve prohibition of transactions.

      But this is a pseudo problem (or pseudo-defect); you see, the satisfaction (or lack thereof) with the justice of a process is as much an outcome of the process as is its distributive one. Therefore, Nozick is quick to prohibit unwanted transactions (stealing, breach of contract), as much as Rawls. In this sense, Nozick and Marx are also putting forth static counter-arguments, only they look at different outcomes.

      The actual problem of most social theories is their lack or consideration to the relativistic nature of justice. Cleisthenes and Lycurgus arrived at radically different processes, and so did Rawls and Nozick, no surprise there. What is surprising is that neither bothered to consider the true dynamic: how should the “rule setting” process be repeated?

      In a sense, a static theory is like conducting a poll by searching for a “representative sample” of 1. Once found, it becomes the standard across space and time. Society’s members are asked to commit to it: “monarchy”, “communism”, “democracy”, “free market”, “guilds”, “castes”, “welfare state”, you name it.

      In your very field of political economy, who has ever worked on rules for changing the economic rules? On the contrary, significant effort—including indoctrination and intimidation—is spent to cement the current system against the winds of natural and moral change. Change or rules is studied as the outcome of “conflict”, “struggle”, “revolution” or “collapse”. Indeed, a change of the rules is the very definition of “crisis”. But it shouldn’t be; it deserves to be recognized as a desirable and organized process (or meta-process if you will) and be considered as the true foundation of modern societies, on top of which the political and economic system is built.

    • In A Theory of Justice, the philosopher John Rawls distinguished three ideas of procedural justice:[5]

      Perfect procedural justice has two characteristics: (1) an independent criterion for what constitutes a fair or just outcome of the procedure, and (2) a procedure that guarantees that the fair outcome will be achieved.
      Imperfect procedural justice shares the first characteristic of perfect procedural justice–there is an independent criterion for a fair outcome–but no method that guarantees that the fair outcome will be achieved.
      Pure procedural justice describes situations in which there is no criterion for what constitutes a just outcome other than the procedure itself.

      Nozick strictly follows the latter definition. And while the definition of what a just procedure is is delegated to a divine / natural agent (natural rights), he has no ‘independent criterion for what constitutes a fair or just outcome of the procedure’. And that’s precisely what you criticised Piketty’s model for at the beginning of the interview – lacking a concept of just distribution. Can you describe your own opinion on this subject? Maybe that would clarify things.

    • Thanks for the link. I enjoyed that. And I agree with your general point about the importance of understanding the social process. I’m not sure I’m with you regarding the static nature of Rawls’ veil of ignorance – I think it is open to static or dynamic interpretation. So is Nozick, I guess, if one stresses the evolutionary nature of the law. And we know that Marx can easily be (mis)interpreted in a thoroughly totalitarian = static way. Nor am I sure about the practical implications of your concept. Micromanagement of social interactions?

      I think the use of a static outcome has more to do with the limitations of the human mind than with any logical necessity for it. It’s a practical device for feeble minds. Perfect procedural justice, or an ODI, a purely theoretical reference points. And indeed, real world law posits that processes should be fair, i.e. conducted without view to a particular outcome, while politics periodically sets static goals against which we measure the validity of the laws. And if they ain’t good, we changes them. But we cannot judge laws without a reference, even if that reference is individual, dynamic, founded in micro social observations or rough macro rules of thumb or what have you.

      I was also reminded of this: http://howardism.org/appendix/Cohen.pdf

  • Professor Varoufakis,

    In this interview you assert that Marx wasn’t concerned with principles of distributive justice but instead held to a notion of procedural justice, thereby inoculating him from the criticisms libertarians, and various other philosophical schools of conservative thought, might level against him. However, in his Critique of the Gotha Programme, Marx explicitly supports the implantation of labor vouchers in the lower stage of communism – to be replaced by a principle of free access once scarcity has been transcended. Is the latter consistent with what you mean by Marx subscribing to a view of procedural justice, or does he discuss the matter elsewhere?