Quotes from book
Capital in the Twenty-First Century

Name: Capital in the Twenty-First Century
Author: Thomas Piketty

Thomas PikettyOriginal title Le Capital au XXIe siècle (French, 2013)

Capital in the Twenty-First Century is a 2013 book by French economist Thomas Piketty. It focuses on wealth and income inequality in Europe and the United States since the 18th century. It was initially published in French in August 2013; an English translation by Arthur Goldhammer followed in April 2014.The book's central thesis is that when the rate of return on capital is greater than the rate of economic growth over the long term, the result is concentration of wealth, and this unequal distribution of wealth causes social and economic instability. Piketty proposes a global system of progressive wealth taxes to help reduce inequality and avoid the vast majority of wealth coming under the control of a tiny minority.

“National income is defined as the sum of all income available to the residents of a given country in a given year, regardless of the legal classification of that income.”

Thomas Piketty book Capital in the Twenty-First Century

Source: Capital in the Twenty-First Century (2013), p. 43.

“Whenever the rate of return on capital is significantly and durably higher than the growth rate of the economy, it is all but inevitable that inheritance (of fortunes accumulated in the past) predominates over saving (wealth accumulated in the present). … The inequality r > g in one sense implies that the past tends to devour the future: wealth originating in the past automatically grows more rapidly, even without labor, than wealth stemming from work, which can be saved. Almost inevitably, this tends to give lasting disproportionate importance to inequalities created in the past, and therefore to inheritance.”

Thomas Piketty book Capital in the Twenty-First Century

Source: Capital in the Twenty-First Century (2013), p. 377.

“When the rate of return on capital exceeds the rate of growth of output and income, as it did in the nineteenth century and seems quite likely to do again in the twenty-first, capitalism automatically generates arbitrary and unsustainable inequalities that radically undermine the meritocratic values on which democratic societies are based.”

Thomas Piketty book Capital in the Twenty-First Century

Source: Capital in the Twenty-First Century (2013), p. 1.

“Capital is defined as the sum total of nonhuman assets that can be owned and exchanged on some market.”

Thomas Piketty book Capital in the Twenty-First Century

Source: Capital in the Twenty-First Century (2013), p. 46.

“To put it bluntly, the discipline of economics has yet to get over its childish passion for mathematics.”

Thomas Piketty book Capital in the Twenty-First Century

Source: Capital in the Twenty-First Century (2013), p. 32.

“Economists are all too often preoccupied with petty mathematical problems of interest only to themselves. This obsession with mathematics is an easy way of acquiring the appearance of scientificity without having to answer the far more complex questions posed by the world we live in.”

Thomas Piketty book Capital in the Twenty-First Century

Source: Capital in the Twenty-First Century (2013), p. 32.

“I can now present the first fundamental law of capitalism, which links the capital stock to the flow of income from capital. The capital/income ratio β is related in a simple way to the share of income from capital in national income, denoted α. The formula is
α = r × β
Where r is the rate of return on capital.
For example, if β=600% and r = 5%, then α = r × β = 30%.
In other words, if national wealth represents the equivalent of six years of national income, and the rate of return on capital is 5 percent per year, then capital’s share in national income is 30 percent.”

Thomas Piketty book Capital in the Twenty-First Century

Source: Capital in the Twenty-First Century (2013), p. 52.

“The overall importance of capital today, as noted, is not very different from what it was in the eighteenth century. Only its form has changed: capital was once mainly land but is now industrial, financial, and real estate. We also know that the concentration of wealth remains high, although it is noticeably less extreme than it was a century ago. The poorest half of the population still owns nothing, but there is now a patrimonial middle class that owns between a middle and a third of total wealth, and the wealthiest ten percent now own only-two thirds of what there is to own rather than nine-tenths.”

Thomas Piketty book Capital in the Twenty-First Century

Source: Capital in the Twenty-First Century (2013), p. 377; As cited in: " Thomas Piketty Capital in the twenty first century‎ Part III http://robertpaulwolff.blogspot.nl/2014/03/thomas-piketty-capital-in-twenty-first_30.html" on robertpaulwolff.blogspot.nl, 2014/03.

“Broadly speaking, the rise of the supermanager is largely an Anglo-Saxon phenomenon.”

Thomas Piketty book Capital in the Twenty-First Century

Source: Capital in the Twenty-First Century (2013), p. 315.

“Democracy will never be supplanted by a republic of experts - and that is a very good thing.”

Thomas Piketty book Capital in the Twenty-First Century

Source: Capital in the Twenty-First Century (2013), p. 2.

“The distribution of wealth is one of today’s most widely discussed and controversial issues. But what do we really know about its evolution over the long term? Do the dynamics of private capital accumulation inevitably lead to the concentration of wealth in ever fewer hands, as Karl Marx believed in the nineteenth century? Or do the balancing forces of growth, competition, and technological progress lead in later stages of development to reduced inequality and greater harmony among the classes, as Simon Kuznets thought in the twentieth century? What do we really know about how wealth and income have evolved since the eighteenth century, and what lessons can we derive from that knowledge for the century now under way?”

Thomas Piketty book Capital in the Twenty-First Century

Source: Capital in the Twenty-First Century (2013), p. 1 Introduction: Lead paragraph; Quoted in From the Introduction to Capital in the Twenty-First Century, by Thomas Piketty http://www.hup.harvard.edu/features/capital-in-the-twenty-first-century-introduction.html, at hup.harvard.edu, 2014.

“Modern economic growth and the diffusion of knowledge have made it possible to avoid the Marxist apocalypse but have not modified the deep structures of capital and inequality—or in any case not as much as one might have imagined in the optimistic decades following World War II.”

Thomas Piketty book Capital in the Twenty-First Century

Source: Capital in the Twenty-First Century (2013), p. 1.