The (F)Laws of Piketty’s Capitalism: A Fundamental Approach

Marcel R. de la Fonteijne

MPRA Paper from University Library of Munich, Germany

Abstract: The book 'Capital in the Twenty-First Century' by the French economist Piketty about the inequality of income and wealth distribution is already quite a while in the spotlights. Throughout his book he uses two formulas which he has named ‘the first fundamental law of capitalism’ and ‘the second fundamental law of capitalism’. With his reasoning he tries to show that, with these laws in place, he is capable to explain inequality phenomena with respect to the income and wealth distribution. Without going into the significance of his reasoning and conclusions, we will show that the use of the laws, the way he does, is fundamentally wrong. We suggest alternative formulas and a new approach. The inequality r>g is in our opinion not a meaningful equation with respect to inequality.

Keywords: sustainability; inequality; unemployment; GDP growth; income; wealth distribution (search for similar items in EconPapers)
JEL-codes: E00 E10 E20 E60 H20 H30 H60 (search for similar items in EconPapers)
Date: 2014-12-24
New Economics Papers: this item is included in nep-his, nep-hpe and nep-mac
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:72719

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