Economics
of Inequality/Economie des inégalités
(Master
APE,
Thomas
Piketty
Academic
year 2010-2011
Syllabus & Course Material
(January 31st 2011)
(check on line for updated versions)
Email : piketty@ens.fr
Office hours:
Tuesdays 9h-12h, Jourdan B101
Course web page : http://piketty.pse.ens.fr/fichiers/enseig/ecoineg/EcoIneg.htm
Previous years
syllabuses : http://piketty.pse.ens.fr/fichiers/enseig/ecoineg/
The
objective of this course is to present recent research in the area of income
and wealth distribution. Issues will include the following. How did income and
wealth distributions evolve since the 19th century, how can we
account for these changes? What was the interaction with the growth and capital
accumulation process? Do existing models of growth and distribution properly
account for these facts? Did the recent rise of inequality contribute to the
2007-2010 financial crisis? What will be the impact of the crisis on the
structure of income and wealth distributions?
This
course will take for the most part a positive perspective on distributional
issues. For references on normative models of optimal taxation and
redistribution, see the syllabus of my Public
Economics course (or other courses).
The
course will be organized in 8 lectures of 3 hours. In order to validate the
course, students are required (1) to attend and actively participate to all
lectures; (2) to send me by email before 30/1/2011 a “referee report” (2-5
pages) on a research paper chosen in this syllabus (or in the previous years
syllabuses); the report must summarize the paper’s contribution and assesses
its strength and weaknesses [exemples
of referee reports]; or (3) to
present a research paper during the lectures; students choosing this option
should pick a paper and inform me by mail asap.
Lecture
1: Tuesday November 30th 2010, 15h30-18h30, Salle E101 Jourdan
Lecture
2: Tuesday December 7th 2010, 15h30-18h30, Salle E101 Jourdan
Lecture
3: Tuesday December 14th 2010, 15h30-18h30, Salle E101 Jourdan
Lecture
4: Tuesday January 4th 2011, 15h30-18h30, Salle E101 Jourdan
Lecture
5: Tuesday January 11th 2011, 15h30-18h30, Salle E101 Jourdan
Lecture
6: Tuesday January 18th 2011, 15h30-18h30, Salle E101 Jourdan
Lecture
7: Tuesday January 25th 2011, 15h30-18h30, Salle E101 Jourdan
Lecture
8: Tuesday February 1st 2011, 15h30-18h30, Salle E101 Jourdan
A.
Atkinson, The economics of inequality, Clarendon Press, 1983
A.
Atkinson, F. Bourguignon, Handbook of Income Distribution,
North-Holland, 2000
A. Atkinson, T. Piketty, Top incomes
over the twentieth century, volumes 1 & 2, Oxford University Press,
2007 & 2010
G. Bertola, R. Foellmi, J. Zweimuller, Income
distribution in macroeconomic models, Princeton University Press, 2006
D.
G. Champernowne, F. Cowell, Economic Inequality and Income Distribution,
T. Piketty, L’économie des
inégalités,
T. Piketty, Les hauts revenus en
France au 20ème siècle – Inégalités et redistributions, 1901-1998,
Grasset, 2001
T. Piketty, « On the Long
Run Evolution of Inheritance – France 1820-2050 », Working Paper
PSE 2010 Data
Appendix Part 1 Data
Appendix Part 2
Be careful with data sources
(a) National income and wealth accounts
(b) Income and wealth surveys (Insee: Budget, Emploi, Logement, Patrimoine, etc.)
(c) Administrative income and wealth tax files (RF,
IR, ISF, ISu, IS, etc.)
Income
= Capital income + Labor income: Y = F(K,L) = YK+YL
Course Notes: Basic
Models of Inequality - Capital vs Labor
Example:
see Distribution of
Income & Wealth in France 2010
Question 1: Are labor &
capital shares (factor shares) stable in the long run, & why?
See Course Notes on
Factor Shares and Production Functions
[Selected figures on
factor shares and wealth-income ratios in France 1820-2008]
See Course Notes on the measurement
of factor shares and wealth-income ratios
Question 2: Are wealth-income
ratios stable in the long run, & why?
Is
balanced growth possible?
See Course Notes on
Models of Growth, Capital accumulation and Distribution
Week 3. The Rise of Inequality
& the Financial Crisis
A.Atkinson,T.
Piketty & E. Saez, “Top Incomes in the Long Run of History”, JEL 2011
H.Kumhof,
R.Rancière, “Inequality, Leverages, and Crises”, PSE and IMF, 2010
P.Aghion, A.Banerjee,
T.Piketty, “Dualism and Macroeconomic Volatility”, QJE 1999
See Course
Notes on Models of Wealth Accumulation & Distribution
Kotlikoff, L and L. Summers, “The Role of
Intergenerational Transfers in Aggregate Capital Accumulation”, JPE 1981
F.
Modigliani, “Life Cycle, Individual Thrift and the Wealth of Nations”, AER 1986
T. Piketty "On the Long Run
Evolution of Inheritance", WP 2010
T. Piketty, G. Postel-Vinay
et J.L. Rosenthal, “Wealth Concentration in a Developping Economy: Paris and
France, 1807-
W. Kopczuk et E. Saez, « Top Wealth Shares in the
United States, 1916-2000 – Evidence from Estate Tax Returns », National Tax Journal 2004
J. Roine and D. Waldenstrom, “Wealth Concentration
over the Path of Development:
R. Burckhauser, S. Feng, S. Jenkins, and J. Larrimore,
“Recent Trends in Top Income Shares in the
S. Kaplan and J. Rauh, “Wall Street and
M. Bertrand and S.
Mullainathan, “Do CEOs Set Their Own Pay ? The Ones Without Principals
Do”, Quarterly Journal of Economics 116 (3) (August 2001), pp.901-932 [article
in pdf format]
X.
Gabaix and A. Landier, “Why Has CEO Pay Increased so Much?”, Quarterly
Journal of Economics 2008 [article
in pdf format]
C.
Frydman and R. Molloy, “Does Tax Policy Affect Executive Compensation? Evidence
from Postwar Tax Reforms”, mimeo, 2009 [article in pdf format]
R.
Gordon, “Misperceptions about the Magnitude and Timing of Changes in American
Income Inequality”, NBER Working Paper 15351 (2009) [article in pdf format]
J. Rotemberg, “Perceptions of Equity and the
Distribution of Income”, Journal of Labor Economics 2002 [article in pdf format]
M. Tervio, “Superstars and
Mediocrities: Market Failure in the Discovery of Talent”, RES 2009
E. Saez, J. Slemrod and
E. Wolff, A. Zacharias, “Household Wealth & the
Measurement of Economic Well-Being in the
Week
7 & 8: The World Distribution of Wealth & Global Imbalances
Global wealth accounts and distributions:
J.
Davies et al, “The Level and Distribution of Global Household Wealth”, NBER
2009
J.Davies,
A.Shorrocks, “Global Wealth Report”, Credit Suisse 2010 Databook
External wealth accounts: NFAt+1 = NFAt
+ Xt-Mt + rt NFAt
P. Lane, G.
Milesi-Ferreti, “The External Wealth of Nations, Mark II”, JIE 2007
G.
Milesi-Ferretti, “Global Rebalancing”, IMF 2010
P.O.
Gourinchas, H. Rey, « International Financial Adjustment », JPE 2007
P.O.
Gourinchas, H.Rey, “Exorbitant Privilege & Exorbitant Duty”, 2010
Tax havens and missing wealth:
G. Zucman,
“The Missing Wealth of Nations – Evidence from Switzerland 1945-2008”, PSE,
2010
See also « Tax Havens and
Development », Commission on Capital Flight 2009
Wealth taxes and capital flight:
French
wealth tax schedules (ISF)
See also www.revolution-fiscale.fr