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The Piketty opportunity: inequality, global comparisons and a new agenda for economic history

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If you have a question about this talk, please contact Dr Duncan Needham.

This seminar will focus upon a recently published collection of essays, The Contradictions of Capital in the Twenty-first Century: the Piketty Opportunity (Newcastle, Agenda Publishing 2016). First the editors will briefly explain the purpose and the structure of the volume. They will make clear that, in its attention to key definitions and concepts, relating to inequality, and in its focus upon regional specificities on a global scale, the volume attempts to promote Piketty’s work as a springboard for developing new ideas and approaches in economic history and for re-introducing politics and political power into the heart of economics. Pat Hudson will outline some of long-standing debates, concepts, measures and methods, in economics and economic history that Piketty’s work exposes for examination. Comparative measures of ‘development’, growth theory, definitions and measures of capital and wealth, technological innovation, ideas about convergence and divergence, the central importance of politics and ideology in economic change – these can all be placed in the spotlight created by Piketty, with salutary implications. In his insistence on the importance of understanding the dynamics and the implications of accumulation and inequality, Piketty offers a new angle on development. In his preference for induction, for new data gathering, for descriptive rather than analytical statistics, and in his questioning of the utility of multiple regression analysis especially in relation to complex cross national data, he opens up ground for a critique of approaches and methods that have dominated the fields of economics and economic history for decades. Piketty and his colleagues also fundamentally unsettle the assumption that the night watchman state and liberalised markets are good for growth. Piketty’s data and his thesis (with their absences as well as their presences) demand that many lines of conventional research be given renewed attention, in particular the impact of inequality upon the distribution of financial assets and investment patterns, on aggregate and differentiated patters of demand (hence of innovation and economies of scale), on human capital (through unequal access to education and training as well as nutrition and health), and on the nature of the state and political instability. Keith Tribe will next seek to open out issues of comparative method in the study of economic history, whilst also emphasising the major argument of the volume: that Piketty has created an opportunity to bring economic, political and historical analysis closer together. Drawing upon the chapters that address the specificities of the economies treated by Piketty as “the developed world” (France, Germany, Sweden, UK, USA ), he will first point out differences in institutional structure and chronology raised by the authors, suggesting that these undermine the usual practice of making comparisons in which either an abstract model, or one particular national developmental model, is used both to elucidate basic trends and also to register “deviations” from this trend. He will argue that this is as much a problem for long-run economic historical work on one particular territory/state as it is for cross-country comparisons in a restricted timeframe. The big question is how best to make sense of social and economic development without falling back upon conceptual frameworks that suppress difference and impose artificial uniformity. This is both a very old story – the origins of capitalism, the emergence of individualism, the story of industrialisation etc. – but also an argument that seems to need constant re-emphasis, given the persistence of presentist historiographies of the past. To move on from the opportunity that Piketty has created it will be necessary further to question the goals of growth and development: how to promote better social outcomes from economic growth, how to reconcile growth with equity and sustainability. The ways in which the success or failure of national economies (and of the international economy) might be measured will also need more sophisticated yardsticks than are currently applied, yardsticks that place distributional issues back at centre stage. The role of new technologies in determining growth rates and income distribution, in developing as well as in leading nations, will need more attention than Piketty gives it. Above all, we must take Piketty’s lead in finding better ways to link economic analysis nationally and internationally to politics and to the exercise of economic and political power. Economics in the twenty-first century, both nationally and globally, must be related to the trajectory of democracy and its abuses.

This talk is part of the Core Seminar in Economic and Social History series.

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