“Part of his interpretation I do not share. Piketty argues that there is a natural tendency for high inequality in ‘capitalist’ economies (the term capitalist is not my favorite) and that certain unusual events (world wars, the Great Depression and policy responses thereto) temporarily reduced inequality. Then both earnings inequality and inequality between capital and labor have been reverting back to their ‘normal’ levels. I don’t think that the data allow us to reach this conclusion. All we see is this pattern of fall and rise, but so many other things are going on. It is consistent with what Piketty says, but it is also consistent with certain technological changes and discontinuities (or globalization) having created a surge in inequality which will then stabilize or even reverse in the next several decades. It is also consistent with the dynamics of political power changing and this being a major contributor to the rise in inequality in advanced economies. We may be seeing parts of several different trends underpinned by several different major shocks rather than the mean-reverting dynamics following the shocks that Piketty singles out.”

I think that's an interesting response to Piketty's idea.

I'll be reading this book, certainly.

“The way forward is to reform the structure of American business so that workers can supplement their wages with significant capital ownership stakes and meaningful capital income and profit shares.”

Here's another interesting idea. Great article, full of good stuff.