I am unfortunately not an economist, but I’ve read several discussions and criticisms of Piketty’s work.
It looks to me like all commenters are missing what seems to me to be the elephant on the sofa.
The greatest returns in the last 20 years have not been on invested capital, they’ve been for creative ideas.
The founders of Google, Apple, Facebook et al did not get rich because they invested capital, they got rich because they created entire new industries using just their minds. The capital investment, while necessary, was among the least important factors in this generation of wealth.
Meanwhile, you can sit around and invest capital all you want, and in and of itself the return often sucks pretty hard. Extract the “creativity return” I’m positing, and I suspect the average return on “capital” has been pretty lousy.
But possibly I’m drawing a distinction that isn’t meaningful.
>> The capital investment, while necessary, was among the least important factors in this generation of wealth.
Capital is arguably the most important factor especially since an operation does NOT require extraordinary creativity to flourish. Furthermore, capital often plays an ongoing role in the operational life cycle for companies large and small. A company’s retained capital also plays an important role in growth and survival. Even distributed capital is often reinjected for sustainability and growth.
“....did not get rich because they invested capital...”
Intellectual Capital IS Capital. Capital isn’t just dollars.
The crux of Adam Smith’s seminal work was that each person has something of value to contribute. That led to the end of slavery, for one thing. And it also creates the opportunity for those in possession of intellectual capital to become wealthy.
After wasting your time on Piketty you need to read Mystery of Capital by DeSoto. He will explain the reality to you that totally escapes the picketties of the world.