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After Piketty: The Agenda for Economics and Inequality

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After Piketty: The Agenda for Economics and Inequality

by Heather Boushey

4.3 out of 5

Language	:	English
File size	:	30579 KB
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Print length	:	673 pages

In his 2014 book, Capital in the Twenty-First Century, French economist Thomas Piketty argued that the gap between the rich and the poor is widening, and that this trend is likely to continue unless we take action. Piketty's book has sparked a renewed debate about inequality, and it has also helped to shape the research agenda for economists. In this article, we will explore the current state of economics and inequality, and we will consider the challenges and opportunities for the future.

The Current State of Economics and Inequality

The global economy has undergone a number of significant changes over the past few decades, including the rise of globalization, the decline of manufacturing, and the growth of the service sector. These changes have had a number of consequences for inequality, including:

The rise of the 1%. The richest 1% of the population now owns more than 40% of the world's wealth, while the bottom 50% of the population owns less than 1%. This gap is growing wider, and it is expected to continue to grow in the years to come.
The decline of the middle class. The middle class is shrinking in many countries, as more and more people are falling into poverty or moving into the upper class. This is due to a number of factors, including the decline of manufacturing jobs, the rising cost of education and healthcare, and the increasing concentration of wealth at the top of the income distribution.
The rise of intergenerational inequality. The gap between the rich and the poor is also growing across generations. Children from wealthy families are more likely to have access to good education and healthcare, and they are more likely to inherit wealth from their parents. This makes it increasingly difficult for children from poor families to move up the economic ladder.

These trends are having a number of negative consequences for society, including:

Social unrest. Inequality can lead to social unrest, as people become increasingly frustrated with the unfairness of the system.
Political instability. Inequality can also lead to political instability, as people lose faith in the government's ability to address their needs.
Economic stagnation. Inequality can lead to economic stagnation, as the poor have less money to spend and the rich have less incentive to invest.

The Challenges and Opportunities for the Future

The challenges facing economics and inequality are significant, but there are also a number of opportunities for the future. One of the most important challenges is to develop new economic models that can better explain the causes and consequences of inequality. Current economic models are often based on the assumption that everyone is rational and self-interested, and they do not take into account the role of power and social institutions. We need to develop new models that can better capture the complexity of the real world.

Another challenge is to find ways to reduce inequality without harming economic growth. There is a long-standing debate about the relationship between inequality and growth, and some economists argue that reducing inequality will lead to slower growth. However, there is also evidence to suggest that reducing inequality can actually lead to faster growth by increasing demand and investment. We need to find ways to reduce inequality without harming growth, and we need to be willing to experiment with new policies.

Finally, we need to find ways to address the underlying causes of inequality, such as discrimination, exploitation, and poverty. These are complex issues, but we need to start addressing them if we want to create a more just and equitable society.

The challenges facing economics and inequality are significant, but there are also a number of opportunities for the future. By working together, we can create a more just and equitable society for all.

After Piketty: The Agenda for Economics and Inequality

by Heather Boushey

4.3 out of 5