Thomas Piketty, the Lena Dunham of economics in 2014, is finally getting to his backlash phase. According to the Financial Times, Piketty’s world-rattling best seller on growing inequality, Capital in the Twenty-First Century, is based on data that may “contain a series of errors that skew his findings,” including “mistakes and unexplained entries in his spreadsheets,” which the business paper compares to the humiliating screw-ups found last year in an austerity study by Harvard professors Carmen Reinhart and Kenneth Rogoff. Except Piketty is much more famous.
Prof Piketty, 43, provides detailed sourcing for his estimates of wealth inequality in Europe and the US over the past 200 years. In his spreadsheets, however, there are transcription errors from the original sources and incorrect formulas. It also appears that some of the data are cherry-picked or constructed without an original source.
For example, once the FT cleaned up and simplified the data, the European numbers do not show any tendency towards rising wealth inequality after 1970. An independent specialist in measuring inequality shared the FT’s concerns.
The economist responded in a statement, claiming he used “a very diverse and heterogeneous set of data sources ... [on which] one needs to make a number of adjustments to the raw data sources.” He added, “I have no doubt that my historical data series can be improved and will be improved in the future ... but I would be very surprised if any of the substantive conclusion about the long-run evolution of wealth distributions was much affected by these improvements.”
That, of course, does not settle that, and Memorial Day weekend will now include many more spreadsheets than originally planned for a select few.