Thomas Piketty’s Capital in the 21st Century from a Marxist Perspective – audio

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On 6th December, I was kindly invited by the editorial board of Science & Society (the oldest continuously published journal of Marxist scholarship worldwide) to deliver a keynote to its Editorial Board’s Annual Meeting. My talk was based on a recent critical review of Piketty’s Capital in the 21st Century which can be read here. To listen to my talk, click...


  • Great points Prof!.
    Beyond the methodological critique ( which I accept) I would like to add that Pikketty´s work misses an essential point : The global nature of Capitalism . Even Marx from a mid 19 century perspective was well aware of the ever expanding nature of the Capitalism and our 21 century confirms that view.
    The whole book deals with Inequality within individual countries that operate in a globalized Capitalism ( at least in commodities and capital aspects in our days ). Such narrow perspective ignores the REAL and most acute divergence between the developed and developing world ( much worst than within national boundaries).
    True, Pikkety mentions that international aspect is not that important nowadays ( mainly measuring the yield from foreign assets ) . However, that is a rather narrow vision of economic relations, since by saying that P. ignores a vast array of mechanisms ( such as currency dominance, trade arrangements, political oppression and so on ) which perpetuates an immense gap between North and South.

  • Excellent points as per use.
    However, is it possible to have a clarification of your thoughts in one point?
    In the start of the talk you argue that an investment by the Greek elites in the housing market in London can not be classified as capital. How about the, and I hate to use the term but, trickle effect that the capital input will be used for debt repayment (which will allow banks to lend more), new projects or investment in money funds that may, or may not, invest in productive activities?

    • If this happens, and a portion of those funds ends up in investment in productive capacity, then that part does constitute a capital infusion. But to claim that the increase in the house price is an increase in capital is absurd!

    • Indeed anyone can find causal links on most things; I for instance could counter argue that an increase of a bubble priced house can create a virtuous cycle of positive feedback loop in the real economy. The point I guess is to be able to coherently substantiate everything with data based on reality and in this particular example (what portion of the overinflated added value increases productive capacity), may very well be impossible to prove in any statistically significant measure. Thank you professor.

  • Excellent talk, one quibble about the point you raise at the end regarding children being given awards for “just showing up” it might be worth reading Alfie Kohn’s ‘Myth of the Spoilt child’ where he effectively demonstrates that such notions are not only wrong but destructive, it has a chapter which specifically deals with the negative perception of participation trophies and the excessive valourisation of competition as being an effective motivator called ‘Getting Hit on the Head Lessons: Motivation, Failure, and the Outrage over Participation Trophies’.

    His contempt for such views is withering, one choice quote;

    “…a separate body of research suggests that competition is uniquely counterproductive (as a motivator). Typically its effect is to undermine self-confidence, relationships, empathy and the inclination to help, instrinsic motivation and most surprisingly excellence. Contrary to popular belief, competition usually does not enhance achievement, even on straight-forward tasks. And when the tasks are more complex – for example, when they involve creativity – study after study shows that the absence of competition is more likely to produce better results. That’s true in part because a competition is more likely to produce better results. That’s true in part because a competition environment (I can succeed only if you fail) strongly discourages the arrangement that does help people to do their best: cooperation (I can succeed only if you also succeed).

    When we set children against each other in contests – from spelling bees, to award assemblies to science ‘fairs’, from dodge ball to honour rolls to prizes for the best painting or the most books read – we teach them to confuse excellence with winning, as if the only way to do something well it to outdo others. We encourage them to measure their own value in terms of how many people they’ve beaten, which is not exactly a path to mental health. We invite them to see their peers not as potential friends or collaborators, but as obstacles to their own success. (Quite predictably researchers have found that the results of competition often include aggression, cheating, envy of winners, contempt for losers and a suspicious posture toward just about everyone.) finally, we lead children to regard whatever they’re doing as a means to an end: The point isn’t to paint or read or design a science experiment, but to win.”

  • Στο μυαλό μου εδώ και μέρες έχω την κριτική του Βαρουφάκη στον Πικετί για τον πλούτο vs κεφάλαιο…..Και όσο το σκέφτομαι, νομίζω ότι η αλήθεια είναι κάπου στη μέση….
    Στις δυτικές κορεσμένες και παγιωμένες οικονομίες τα τελευταία αρκετά χρόνια, με την ανοιχτή, μαζική εκπαίδευση, το ανθρώπινο κεφάλαιο τείνει πλέον να αποτελεί μέρος ενός μηχανισμού κληρονομικής διαιώνισης του πλούτου και των ανισοτήτων…(ιδιαίτερα στην πελατειακή Ελλάδα)…άρα η θεωρία του Πικετί για την ανισότητα δεν μπορεί παρά να έχει ισχύ και για τις εργασιακές σχέσεις…
    Από την άλλη για τις “υπό ανάπτυξη χώρες”, ναι η κριτική του κ.Βαρουφάκη έχει νόημα και προσωπικότητα…το κεφάλαιο είναι “a produced means of production” και όχι ο ανενεργός πλούτος….
    Η Ελλάδα “αν δεν έχει γίνει ακόμα Ουκρανία”, βρίσκεται κάπου στη μέση…?
    (Δεν είμαι οικονομολόγος, απλά πήρα το θάρρος)

  • Hi Yianis maybe in the future you have time to revisit and find this new review interesting :

    “Challenging the Empirical Contribution of Thomas Piketty’s Capital in the 21st Century” by Phillip W. Magness and Robert P. Murphy the abstract :

    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 the book’s greatest weakness.

    posted by University of Chicago Economist John Cochrane on 07.01.2015

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