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Alright, let's actually follow up on two of your links for once. Regarding "The IMF was unable to reproduce": "Piketty's response[54] noted, however, that Góe
by jahaja 6y ago
Alright, let's actually follow up on two of your links for once.
Regarding "The IMF was unable to reproduce":
"Piketty's response[54] noted, however, that Góes used measures of income inequality rather than wealth inequality, and inappropriately took the interest rate on sovereign debt as his index of the rate of return on capital, which makes his results not commensurate with those of Piketty's study."
Regarding "Auten & Splinter further refuted":
"There’s plenty of other literature, mentioned in the Auten-Splinter paper, the Economist articles and elsewhere, that challenges the methods used by Piketty and his collaborators. Such challenges are mainly possible because tax data draw an incomplete and often difficult-to-interpret picture of the income distribution. Tax systems are complex, different governments choose not to tax different kinds of income, and of course people, rich and poor, cheat on their tax returns. Measuring wealth inequality rises to a whole new level of difficulty: Since so few countries have wealth taxes these days, only guesstimates of the wealth distribution are possible.
So on Tuesday, Piketty, Saez, Zucman and a long list of other signatories issued a sweeping response to critics of the popular inequality narrative, pointing out that all the data-based arguments can be settled by making solid data available."
Unsurprisingly, these two doesn't seem to very convincing "refutations".
- bhupy 6y agoI'm not convinced you actually read through either of those sources, especially considering that none of your quotes actually ever appear in them. First, and foremost, Piketty's findings are based on theoretical models, not empirical observations. The two fatal flaws Piketty makes are 1) he models a zero-sum world where wealth is fixed, and 2) doesn't take into account taxes & transfers. From the IMF research: Using a sample of 19 advanced economies spanning over 30 years, I find no empirical evidence that dynamics move in the way Piketty suggests. Results are robust to several alternative estimates of r-g. I find no empirical evidence that the dynamics move in the way Piketty suggests. In fact, for at least 75% of the countries examined, inequality responds negatively to r − g shocks, which is in line with previous single-equation estimates by Acemoglu and Robinson (2015). The results also suggest that changes in the savings rate, which Piketty takes as relatively stable over time, are likely to offset most of the impact of r − g shocks on the capital share of the national income. Thus, it provides empirical evidence to the model developed by Krusell and A. Smith (2015), who say Piketty relies on flawed theory of savings. The conclusions are robust to alternative estimates of r − g and to the exclusion or inclusion of tax rates in the calculation of the real return on capital. From Auten & Splinter Our estimates also differ for the bottom half of the distribution. PSZ estimated that the bottom 50 percent share of pre-tax and after-tax shares decreased by about 7.5 and 6.2 percentage points since 1979. In contrast, we estimate that pre-tax and after-tax income shares decreased by 5.6 and 2.2 percentage points over this period. Our estimates suggest that taxes and transfers offset most of the recent changes in both bottom and top income shares. In contrast with the PSZ estimate that average real pre-tax incomes of the bottom 50 percent remained virtually unchanged, we estimate that they increased by nearly one-third. For pre-tax/after-transfer income (which includes Social Security benefits) and after-tax income, we estimate a real increase for the bottom half of the distribution of nearly two-thirds
- jahaja 6y ago> I'm not convinced you actually read through either of those sources, especially considering that none of your quotes actually ever appear in them. Of course I didn't? That would require me to spend several hours to go through those reports, hence I refer to other who have. Why don't you answer the replies to each report instead - of people that have actually had the time to go through them and reply?