CAMBRIDGE – Reading Thomas Piketty’s influential new book Capital in the Twenty-First Century, one might conclude that the world has not been this unequal since the days of robber barons and kings. That is odd, because one might conclude from reading another excellent new book, Angus Deaton’s The Great Escape (which I recently reviewed), that the world is more equal than ever.
Which view is right? The answer depends on whether one looks only at countries individually or at the world as a whole.
The overarching fact in Deaton’s book is that over the last few decades, several billion people in the developing world, particularly in Asia, have escaped truly desperate levels of poverty. The same machine that has increased inequality in rich countries has leveled the playing field globally for billions. Looking from afar, and giving, say, an Indian the same weight as an American or a Frenchman, the last 30 years have been among the greatest in human history for improving the lot of the poor.
Piketty’s brilliant book documents within-country inequality, with the main focus being on the rich world. Much of the cultural groundswell surrounding his book has come from people who view themselves as middle class within their own countries, but who are upper middle class or even rich by global standards.