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Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

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Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#321
post #311
post #310

Earlier quoted context omitted.

Yes, that confusion is a decent enough explanation. The important thing I want to highlight, is that as factors of production go, increasing returns to land have different policy implications than increasing return to capital: A general wealth tax might be required if capital was actually the problem; with all the economic inefficiency that implies. I don't know for sure. But increasing returns to land have a simple…

I'm sold to Henry George's land value tax idea, if we were to create a nation. But we aren't. In our current situation, I would worry that taxing only the wealth "stored" in land ownership would create a massive economical crisis as capital tries to escape this new tax. A broader wealth tax base, with a slightly higher rate for land, is a more prudent approach.

The Australian capital territories are currently phasing in a broader land taxt and phasing out stamp duty in exchange. Not flight of capital has happened so far, and no crisis either.

And how is land supposed to flee? You can't take soil with you.

Wouldn't a broader wealth tax that applies to movable capital as well lead to that very moveable capital fleeing? (As an example, I am currently in the process of optimizing my own capital gains taxes, by eg choosing the country I hold my assets in carefully.)

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#322
post #321
post #311

Earlier quoted context omitted.

I'm sold to Henry George's land value tax idea, if we were to create a nation. But we aren't. In our current situation, I would worry that taxing only the wealth "stored" in land ownership would create a massive economical crisis as capital tries to escape this new tax. A broader wealth tax base, with a slightly higher rate for land, is a more prudent approach.

The Australian capital territories are currently phasing in a broader land taxt and phasing out stamp duty in exchange. Not flight of capital has happened so far, and no crisis either. And how is land supposed to flee? You can't take soil with you. Wouldn't a broader wealth tax that applies to movable capital as well lead to that very moveable capital fleeing? (As an example, I am currently in the process of optimizi…

I was more talking about a fall of real estate valuations as you introduce a significant land value tax. And it must be significant to cancel the impact of land value on the rise of inequality.

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#323
To those who desperately want free markets proven inherently unjust, Piketty is a prophet. But he's a false prophet. He's pretty much a hack of a social scientist.

"We find evidence of pervasive errors of historical fact, opaque methodological choices, and the cherry-picking of sources to construct favorable patterns from ambiguous data." [1]

[1] https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2543012

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#324
post #322
post #321

Earlier quoted context omitted.

The Australian capital territories are currently phasing in a broader land taxt and phasing out stamp duty in exchange. Not flight of capital has happened so far, and no crisis either. And how is land supposed to flee? You can't take soil with you. Wouldn't a broader wealth tax that applies to movable capital as well lead to that very moveable capital fleeing? (As an example, I am currently in the process of optimizi…

I was more talking about a fall of real estate valuations as you introduce a significant land value tax. And it must be significant to cancel the impact of land value on the rise of inequality.

Phase it in gradually.

Land prizes don't actually fall in practice with introduction of land value tax, if it goes hand in hand with elimination of other taxes.

In effect, shifting the tax base from labour and capital to land.

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#325
post #312
post #110

Earlier quoted context omitted.

Picketty's theory is that there's something inherent to market economies that leads to capital's share of income increasing. The evidence suggests it's due to peculiarities related to how advanced economies treat property/land, that are orthogonal to their status as market economies, that are responsible for capital's growing share of income.

Piketty's theory is not that capital's share of income is increasing. I read this many time and I think it is a misconception of his work. His theory is that wealth grows faster than the economy, and that it creates wealth inequality. He has shown that it is not something new, that it is something stable throughout history. I'm not even sure that his theory is limited to market economies. At least, it's not limited t…

>Piketty's theory is not that capital's share of income is increasing.

and

>His theory is that wealth grows faster than the economy, and that it creates wealth inequality.

This is the same thing..

Whether the 'income' is in capital gains or in dividends, if wealth grows faster than the economy, it means that capital's share of earnings is increasing.

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