Thomas Piketty’s “Capital in the Twenty-First Century” has made a much bigger splash in the United States than it did in his native France. Tyler Cowen and Veronique de Rugy offer three hypotheses for why the superlatives have been more freely-flowing here: 1) Piketty has been a French intellectual darling for a while, so his Gallic public was already familiar with his thinking about inequality; 2) the zeitgeist in France has turned away from raising taxes to cutting them; and 3) some French economists have recently challenged Piketty’s empirical claims.
I’ll add another possibility to the mix: inequality at the top end of the income distribution has grown much more in the United States than it has in France.
In the United States, the share of pre-tax income going to the richest 1% has more than doubled in the last three decades, reaching almost 20% in 2012, according to calculations from the Organization for Economic Cooperation and Development. During roughly the same period, the share of pre-tax income received by the top 1% in France barely budged.
Additionally, as I’ve written before, historical polling data suggest that Americans care much more about inequality when they feel their own living standards are falling behind or stagnating (as they have been in recent years; look at median household incomes, for example). When a rising tide seems to be lifting all boats, Americans are (relatively) fine with the rich getting much richer.
I don’t know if this correlation between the typical person’s perceived personal mobility chances and his objections to inequality also exists for the French. It certainly seems possible. (Readers, if you know of relevant poll data, let me know.) If it does hold true, it might also help explain why the French public cared less about Piketty’s 700-page tome on inequality than Americans seem to.
Check out income trends in France, and you’ll find that overall income growth was more modest there than in the United States over the last few decades — but the living standards for the bottom 90% of French people improved more than did those for the bottom 90% of Americans. In this sense, the “rising tide” was actually larger for the typical French person than it was for the typical American.
From the O.E.C.D. report:
From the mid-1970s to the late 2000s, the United States average income grew at an annual rate of 1%. However, the vast majority of the population did not see their incomes rising by anything close to this rate. In fact, if one strips out the growth that went to the top 1%, the annual growth rate of the remaining 99% was only 0.6%. Excluding the top income percentile may also change considerably the country ranking in terms of annual income growth. For instance, average real income growth is lower in France than in the United States over the period, but France performed better than the United States when considering income growth of the bottom 99%.
Addendum: A French economist I met recently also noted that the book is even longer in French than it is in English (nearly 1,000 pages vs. about 700, respectively). Perhaps that is holding back its success ever so slightly in France?
Also, and more importantly, I realized I that I repeatedly misspelled Piketty’s name in the earlier version in this post! The spelling has been corrected.