Wednesday, January 14, 2015

A few quick thoughts on the Piketty AEA session

The video is here. I finally got a chance to watch it. Some quick reactions:

1. In order of how interesting the presentations were, the ranking IMO clearly goes Weil > Mankiw > Auerbach. The attention received has been exactly the reverse (assuming we're not counting the attention to hecklers as attention to Mankiw's actual presentation). I want to be clear - I think Auerbach actually had a very nice presentation. It was just mostly dealing with some standard optimal tax theory stuff which I didn't find as interesting.

2. Mankiw made a point that I have been making about Piketty for a while now: r > g is great for the capital share chapters but doesn't give you much on the inequality chapters. Piketty generally did not do a great job connecting up those two big sections of the book. Piketty nods to the point but doesn't do it justice in his response to Mankiw (he acknowledges r > g doesn't matter for income inequality but maintains it's important for wealth inequality).

3. Weil and Makinw have inspired me to write a QJE paper that puts human capital into Piketty's story and leads with the line "This paper takes Thomas Piketty seriously." Now note I'm not saying I'll actually do it - just that they inspired me. This is very much related to a discussion I had with Evan the other day about how Piketty botches his criticism of Goldin and Katz. I don't think he does any better in his response to Weil. On that point...

4. Piketty does a ton of good work and some people don't seem to realize that. And he anticipates a lot of dumb arguments already so most of the things that people think are oh-so-obviously-wrong in Piketty are often not even in Piketty! But he definitely seems slow to react to good arguments and very entrenched in his views.

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