Thomas, Alex M.
(2018)
Thomas Piketty. Capital in the Twenty-First Century (Book Review).
Published in Beyond Disciplines: An International Journal of Central University of Karnataka, 1 (1).
pp. 130-134.
Abstract
For Piketty, capitalism generates forces of convergence as well as divergence. ‘The main forces for convergence are the diffusion of knowledge and investment in training and skills’ (21). However, these forces are not automatic. Indeed, as Piketty notes, ‘the principal force for convergence—the diffusion of knowledge—is only partly natural and spontaneous. It also depends in large part on educational policies, access to training and to the acquisition of appropriate skills, and associated institutions’ (22, also 71). He underplays this element of contingency when he writes that the ‘overall conclusion of this study is that a market economy based on private property, if left to itself, contains powerful forces of convergence associated in particular with the diffusion of knowledge and skills’ (571). Piketty’s fundamental inequality, r > g, is ‘amplified by inequality in the returns on capital as a function of initial portfolio size’ (439) arising primarily from ‘“economies of scale” in portfolio management’ (431). In other words, wealth begets more wealth. Is it not the same with knowledge? Endowments matter in the acquisition of knowledge too because technological diffusion depends on existing technology and skill capacity.
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