• Thomas Piketty’s 2013 book, Capital in the Twenty-First Century, argued that capitalism would naturally lead to greater and greater inequality unless extraordinary forces intervened.
• This year, stocks crashed, disproportionately affecting the wealthy, and wealth inequality has plateaued or declined since Piketty’s book was published.
• Wage inequality has also plateaued or declined, with the bottom 10% of earners seeing real wage gains, and job switching increasing since the pandemic.
• Total income inequality has plateaued, but government benefits have boosted the incomes of the poor relative to others.
• The drops in inequality are modest, and it is unclear why they are happening, but it suggests that predictions of an imminent crisis of capitalism were overdone.
Published January 1, 2023. Visit Noahpinion to read Noah Smith’s original post.
