Phillip W. Magness

U.S. Economic & Political History

About that new “study” that supposedly vindicates Piketty…

| May 31, 2014

Robert Murphy has an excellent post up today following a conversation about the new Saez-Zucman (2014) “study” of US wealth inequality that Piketty is currently trumpeting (see p. 7) as something of a vindication of his highly problematic and as-of-yet still unexplained Figure 10.5. The first takeaway is that Saez-Zucman (2014) isn’t really a study – […]

Remember the…War Revenue Act of 1898!

| May 29, 2014

The federal revenue situation of the late 19th century United States presents a somewhat case study in constitutional political economy, owing to a fairly restrictive constitutional restraint on the means of raising revenue for the federal government. The U.S. Constitution provided Congress with the “Power To lay and collect Taxes, Duties, Imposts and Excises” as its primary means of taxation, […]

Physician, Heal Thyself!

| May 29, 2014

Earlier today Thomas Piketty released a 10 page supplemental appendix to his book Capital and the 21st Century, responding to the raging controversy around his data. The appendix was styled as a response to the Financial Times investigation, although it is relevant to issues that have also been raised elsewhere including on this blog. My initial take is that […]

The 1970s and Piketty’s Figure 10.5

| May 29, 2014

This is what happens to Piketty’s Figure 10.5 if you remove the problematic 1970s data point: Note that I am not endorsing the accuracy of the result, which is still plagued by other questionable data techniques. It also seems reasonable to include an appropriate accounting for the 1970s, assuming one exists (I’m simply saying that […]

Addendum: Examining Piketty’s data sources for US Wealth Inequality

| May 27, 2014

The original post that started my ongoing examination of Thomas Piketty’s data specifically examined a series of irregularities on Figure 10.5, one of his key graphs to sustain his thesis of a trend of increasing US wealth disparity since the 1970s. As I noted, Piketty seems to be using a decennial averaging technique to clean […]

Another Piketty Oddity

| May 27, 2014

I mentioned in my previous post that Thomas Piketty really likes building decennial averages out of annual time series data. As part of the ongoing examination of his historical stats, let’s take a closer look at another one of his graphs, Figure 11.12 covering wealth transfers by inheritance as a percentage of national income across three European […]

More on Piketty

| May 25, 2014

Following this afternoon’s post, I decided to dig a little further into Thomas Piketty’s data spreadsheets. I’ll start with two general observations: I. Decennial Averaging Piketty seems to have an inordinate fondness for converting his data  into decennial averages. Usually this is done by the not-terribly-sophisticated technique of simply adding up annual stats (or in many cases percentage […]

Piketty Tricketty & Historical US Wealth Data

| May 25, 2014

If you’ve been following the news for the past few days you’ve probably seen a reference to the Financial Times’ investigation of the data behind Thomas Piketty’s recent bestseller Capital in the 21st Century. While it is difficult to extrapolate intentions from data alone, it seems safe to say now that Piketty was – at minimum […]