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Thomas Piketty's Capital in the 21st Century - An Intellectual Capital Perspective
In this paper we analyze the book that was hailed by Paul Krugman and the Financial Times as the book of the Year of 2014, through the lenses of the Intellectual Capital. Published in French in 2013, and translated into English in 2014, Thomas Piketty's Capital in the 21st century became a worldwide sensation and best seller because of the deepness of its analysis and the controversy of its findings. In a nutshell Piketty claims that contrary to the neoclassical forecast, the Inequality in the world might grow, due to a shock between forces of convergence and forces of divergence. Furthermore, Piketty also claims that only redistribution policies can reduce the inequality trend, and calls for a new set of social policies. All this is very impressive but for us what matters most is how to put IC in the analysis. In this context we analyze Piketty's ideas using the concepts and theories on Intellectual Capital (Bonfour and Edvinsson 2005; Edvinsson and Malone, 1997; Kaplan and Norton, 1994), and we also recall what the main theories on inequalities are (Coleman, 1991, Atkinson 1983 or Stiglitz 2012), and about Welfare States (Esping Andersen, 1990). We find that in the History of socio-economic thought Intellectual Capital and Inequalities have been marching in separate paths: not only the paradigms of analysis are totally different, but only one handful of empirical studies exist that bring together IC and inequalities. The fact is crucial for our paper because we believe that IC in fact increases inequality and explains growing inequality. We also found that Piketty almost does not address IC directly in his entire book, a fact that by itself speaks volumes about the position of IC in the world of socio-economic thought. Pikettys' analysis, for all its importance, and novelty, is traditional and surprisingly old fashioned when it comes to considering Intangibles. He never uses IC, he seems to be unware of IC analysis. However we also think that most of Piketty's analysis would gain strength if IC is considered (as we believe it certainly should be) as a major force of inequality in the economy of the 21st century. In the discussion of the paper we point out nine ways in which the inclusion of IC in the analysis could benefit Piketty's conclusions; the seven ideas relate to IC itself, KM and the knowledge economy, super-professionals, billionaires, Human Capital, social policies and development, taxes on wealth, modern slavery, and the rise of political oligarchies in the 21st Century with relation to technology. The paper is limited because it is basically theoretical. We consider the paper is original because for the first time someone attempts to put together inequality (which is Piketty's point of view) and intellectual capital (which is IC science point of view), as we describe in the theoretical part of the paper. Furthermore we are sure, and demonstrate that both fields should be linked in the future. Finally we believe that our comments on the book which result in the empirical part of the paper are a first step in what we think must be a long road of scientific research.