More love for Thomas Piketty from Martin Feldstein at the Wall Street Journal:
Thomas Piketty has recently attracted widespread attention for his claim that capitalism will now lead inexorably to an increasing inequality of income and wealth unless there are radical changes in taxation. Although his book, “Capital in the Twenty-First Century,” has been praised by those who advocate income redistribution, his thesis rests on a false theory of how wealth evolves in a market economy, a flawed interpretation of U.S. income-tax data, and a misunderstanding of the current nature of household wealth.
I think that Dr. Piketty’s assumptions hold better in Europe than elsewhere. I suspect this debate will continue, possibly for many years to come.
In the meantime I wonder how quickly American economists and politicians will figure out that Dr. Piketty’s global wealth tax which already has no traction will involve taxing poor people in the United States and other rich countries to the benefit of rich people in poor countries?