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Is it fair to talk about inequality inside a country and between countries as it is the same? Obviously, if you move the production to other countries you are

Is it fair to talk about inequality inside a country and between countries as it is the same? Obviously, if you move the production to other countries you are investing in those countries. That should raise the living standards for the people there (and this is a good thing). But this don't, I think, invalidate Piketty and others arguments that tell us about the general trend in the system. Maybe, you don't like that capitalism as answer to everything is not a good answer. Markets are great as tools but terrible as goods.

yummyfajitas 11y ago
I'm talking about inequality between humans - I care nothing about inequality between countries. I have lived in India, and I can state based on extensive experience that Indians are also humans. Piketty's entire case is looking at stats in the US, UK and France, ignoring the east and the world as a whole. He mentions Balzac more frequently than India and China, which is ridiculously myopic in a book on inequality. Ignoring his other flaws (which I've discussed at length) global data does invalidate him.
- RobertoG 11y ago
  Piketty is trying to describe a trend in the system. His message is very clear: If (rate of return on capital > rate of growth) then inequality happens. This is not a so absurd thing to say. In support of this, he contribute massive data where data was available. You can agree with it or not, but it should discuss in its own merits and don't dismiss it because it is not convenient.
  - yummyfajitas 11y ago
    I am indeed arguing the claim has no merit, rather than simply dismissing it. Pikettys message (or at least your interpretation of it) is simply wrong. You need more than r>g as simple math examples show: https://www.chrisstucchio.com/blog/2014/piketty_and_inequality.html https://www.chrisstucchio.com/blog/2014/piketty_and_inequali... (Piketty does have a paper where he provides sufficient, albeit wildly unrealistic, conditions where it is true. I.e. you need a lot more than r>g.) I'm also arguing that brankovics data is more complete than pikettys, and invalidates it. This is precisely an argument against rather than a dismissal. Dismissal is what the op did to brankovic - ignore the argument rather than show why it's wrong.
  - ajuc 11y ago
    Isn't it like measuring temperature in non-isolated system and saying "entropy decreases spontanously"?
    - RobertoG 11y ago
      I like your metaphor, I think I'm going to use it in the future. Entropy is going down in India and China but it's going up in the States and Europe. Does it means that the entropy trend, of all the system, is going down or up?
  - qubex 11y ago
    The thing that annoys me is that compounding (of interest, or economic growth) is order-dependent: given an average but unequal rate of either, you always maximise the outcome by placing the higher values earlier, and the smaller values later, so that the low rates (of interest, or of economic growth) compound upon what is already a maximally expanded base. So speaking of averages is actually rather misleading.
    - yummyfajitas 11y ago
      Multiplication is commutative, you are completely wrong.
- Mikeb85 11y ago
  Remember, that much of the developing world has a legacy of socialism/communism (India included), and much of the progress that has been made, can be attributed to various political movements. You're right that globalization has helped reduce inequality between various countries, it's not always for the obvious reasons (my wife's country of origin subsists almost entirely on money sent from the US and Canada back to family members - there are more migrants abroad than people left in her country). And while India has certainly become richer as a whole, it's still one of the most unequal countries in the world. Last but not least, Piketty chose to focus on France especially, not only because he's French and writing for that audience, but because they have BY FAR the best data accumulated from the 19th century to the present day.
  - yummyfajitas 11y ago
    The drop in inequality has been after liberalization (in china and India, at least), not during communism. Read milanovic's work. India is a more equal country than the US. I have no idea why people think it is unequal - its as if people conflate poverty and inequality or something. You are correct that free trade - including remittances - can reduce inequality. Weren't you just disputing this?
    - Mikeb85 11y ago
      > The drop in inequality has been after liberalization (in china and India, at least), not during communism. Data (which is widely reported and easy to find) shows China has far more inequality today than before reforms. It's a bit more difficult to find data on India, but the OECD says that inequality has doubled in India during the last 20 years as well: http://www.bbc.com/news/world-asia-india-16064321 http://www.bbc.com/news/world-asia-india-16064321 > You are correct that free trade - including remittances - can reduce inequality. Weren't you just disputing this? Free trade doesn't reduce overall inequality, it just shifts it. It transfers wealth from rich countries to poor countries, although it provides the poor country with far less wealth than it transfers from the rich country, with the difference becoming profit for the industrialist. Transfer payments are something different altogether in that they are a direct transfer of wealth, but it's a planned action (on the part of those sending the money), not necessarily a market force. If you look at data, inequality is increasing in most western countries, indeed in most developed and developing countries. https://www.quandl.com/collections/demography/gini-index-by-country https://www.quandl.com/collections/demography/gini-index-by-...

yummyfajitas 11y ago

I'm talking about inequality between humans - I care nothing about inequality between countries. I have lived in India, and I can state based on extensive experience that Indians are also humans. Piketty's entire case is looking at stats in the US, UK and France, ignoring the east and the world as a whole. He mentions Balzac more frequently than India and China, which is ridiculously myopic in a book on inequality. Ignoring his other flaws (which I've discussed at length) global data does invalidate him.

RobertoG 11y ago
Piketty is trying to describe a trend in the system. His message is very clear: If (rate of return on capital > rate of growth) then inequality happens. This is not a so absurd thing to say. In support of this, he contribute massive data where data was available. You can agree with it or not, but it should discuss in its own merits and don't dismiss it because it is not convenient.
- yummyfajitas 11y ago
  I am indeed arguing the claim has no merit, rather than simply dismissing it. Pikettys message (or at least your interpretation of it) is simply wrong. You need more than r>g as simple math examples show: https://www.chrisstucchio.com/blog/2014/piketty_and_inequality.html https://www.chrisstucchio.com/blog/2014/piketty_and_inequali... (Piketty does have a paper where he provides sufficient, albeit wildly unrealistic, conditions where it is true. I.e. you need a lot more than r>g.) I'm also arguing that brankovics data is more complete than pikettys, and invalidates it. This is precisely an argument against rather than a dismissal. Dismissal is what the op did to brankovic - ignore the argument rather than show why it's wrong.
- ajuc 11y ago
  Isn't it like measuring temperature in non-isolated system and saying "entropy decreases spontanously"?
  - RobertoG 11y ago
    I like your metaphor, I think I'm going to use it in the future. Entropy is going down in India and China but it's going up in the States and Europe. Does it means that the entropy trend, of all the system, is going down or up?
- qubex 11y ago
  The thing that annoys me is that compounding (of interest, or economic growth) is order-dependent: given an average but unequal rate of either, you always maximise the outcome by placing the higher values earlier, and the smaller values later, so that the low rates (of interest, or of economic growth) compound upon what is already a maximally expanded base. So speaking of averages is actually rather misleading.
  - yummyfajitas 11y ago
    Multiplication is commutative, you are completely wrong.
Mikeb85 11y ago
Remember, that much of the developing world has a legacy of socialism/communism (India included), and much of the progress that has been made, can be attributed to various political movements. You're right that globalization has helped reduce inequality between various countries, it's not always for the obvious reasons (my wife's country of origin subsists almost entirely on money sent from the US and Canada back to family members - there are more migrants abroad than people left in her country). And while India has certainly become richer as a whole, it's still one of the most unequal countries in the world. Last but not least, Piketty chose to focus on France especially, not only because he's French and writing for that audience, but because they have BY FAR the best data accumulated from the 19th century to the present day.
- yummyfajitas 11y ago
  The drop in inequality has been after liberalization (in china and India, at least), not during communism. Read milanovic's work. India is a more equal country than the US. I have no idea why people think it is unequal - its as if people conflate poverty and inequality or something. You are correct that free trade - including remittances - can reduce inequality. Weren't you just disputing this?
  - Mikeb85 11y ago
    > The drop in inequality has been after liberalization (in china and India, at least), not during communism. Data (which is widely reported and easy to find) shows China has far more inequality today than before reforms. It's a bit more difficult to find data on India, but the OECD says that inequality has doubled in India during the last 20 years as well: http://www.bbc.com/news/world-asia-india-16064321 http://www.bbc.com/news/world-asia-india-16064321 > You are correct that free trade - including remittances - can reduce inequality. Weren't you just disputing this? Free trade doesn't reduce overall inequality, it just shifts it. It transfers wealth from rich countries to poor countries, although it provides the poor country with far less wealth than it transfers from the rich country, with the difference becoming profit for the industrialist. Transfer payments are something different altogether in that they are a direct transfer of wealth, but it's a planned action (on the part of those sending the money), not necessarily a market force. If you look at data, inequality is increasing in most western countries, indeed in most developed and developing countries. https://www.quandl.com/collections/demography/gini-index-by-country https://www.quandl.com/collections/demography/gini-index-by-...