When Thomas Piketty's Capital in the Twenty-First Century appeared in English in 2014, it became the rare academic-economics book to top the New York Times bestseller list. The empirical contribution — assembled with Anthony Atkinson, Emmanuel Saez, and the World Inequality Database team from a century of tax and national-accounts data — was a multi-decade reconstruction of income and wealth distributions across the major economies. The headline finding was that twenty-first-century wealth concentration is approaching Belle Époque levels and that the long post-1945 compression of distributions in advanced economies — the trente glorieuses — was historically anomalous, the product of the destruction of capital in two world wars and the progressive fiscal settlement that followed. The natural trajectory of capitalist economies, Piketty argued, is toward concentration: the rate of return on capital tends to exceed the growth rate of the economy, and the gap compounds across generations.
Measurement choices shape what one sees. The Gini coefficient compresses an entire distribution into a single number running from zero at perfect equality to one when a single person holds everything; it sits around 0.25 in Scandinavia, 0.42 in the contemporary United States, and above 0.5 across much of Latin America. Top-share measures — the share of income or wealth held by the top 1%, 0.1%, or 0.01% — are far more sensitive at the upper end and capture the dynamics Piketty's data made visible, because Gini coefficients moved relatively little while top shares roughly doubled across the 1980-2020 window in most advanced economies. Wealth inequality runs far higher than income inequality everywhere it is measured: the top 1% of US households own roughly a third of household wealth while the bottom 50% own around 3%, because asset stocks compound while wages do not.
The post-1980 rise in within-country inequality is empirically uncontested; what causes it remains contested. Skill-biased technical change — technology raising the relative productivity and pay of the highly educated, the Goldin-Katz framework — captures one large piece. The China-shock literature of David Autor and colleagues documents a second, in which manufacturing wages and employment fell sharply through the 2000s in regions exposed to import competition. A third strand emphasises institutions and policy rather than market forces: US union density fell from around 30% in 1960 to 10% by the 2020s, and top marginal income tax rates fell from above 70% in the 1970s to roughly 37% under most recent law. Superstar economics, assortative marriage among the highly educated, and the spatial concentration of high-productivity activity in a handful of metropolitan regions each add weight. The relative magnitudes are still being worked out, and the policy debate that follows depends on which causes one assigns greatest weight.
The most striking pattern is the divergence between within-country inequality (rising in most advanced economies since 1980) and global inequality between countries (falling over the same period — Branko Milanović's elephant graph). China's rise alone produced more poverty reduction than any single phenomenon in human history. Inequality of opportunity — whether the same families occupy the top across generations — is a separate question; Chetty's Equality of Opportunity Project finds the US has lower intergenerational mobility than most rich peers despite its self-image. The optimal level of inequality is, ultimately, a value question rather than a purely empirical one — and the political consequences of the post-1980 rise, plus the policy responses being debated, are the subject of a separate brief.