Author Description

One of the major issues facing modern societies is the increase in income inequality - the growth in wealth is not being shared among all segments of society. To form a basis for proposals on how to deal with this problem, Thomas Picketty has undertaken a massive analysis of data from many countries. His book on the role capital growth and ownership plays in income inequality has been widely circulated and discussed. But are his conclusions correct? In Inequality: Picketty's Capital in a Nutshell, Robert Schafer provides an overview of Picketty's analysis in an abbreviated and understandable presentation - no need to read all 700 pages of Picketty. Schafer finds that Picketty's analysis does not entirely support the conclusions nor policy proposals that Picketty presents. Some of his theoretical explanations are not supported by his data. While Schafer agrees that there is a close link between capital ownership and income, he presents an alternative approach to dealing with the increasing problem of income inequality, an approach that he argues is just as politically viable as the tax on wealth that Picketty suggests.