Piketty’s Principles May be a Wealth Misconception
No other principles in economics are more necessary than the understanding that, eventually, wealth is not money or financial assets that one may have but, it is rather, the access to actual goods and services that the money can get.
Thomas Piketty, the French economist, seems to be barely aware of this reality, and is focusing on the differences in different people's financial portfolios. He consequently overlooks the much-needed supply side, ignoring what people of all classes, be it rich, middle class or poor can actually buy with the money that they have.
Yet, to the degree that disparity are only relevant and really matters when inequalities in access to the actual goods and services for consumption comes in.
Bill Gates’ living space is definitely larger than that of the common people but even the market economies have seen the consumption ability of the poorest of people has skyrocketed over years. And for the poorer as they could afford, money has enhanced their ability to consume over time.
If the advice of Adam Smith is followed and people's ability to consume is examined it would be discovered that almost in market economies is budding to be richer. It will also be discovered that the real economic disparity that separates the rich from the middle class as well as the poor are gradually shrinking. Considering the standards of living and ability to consume, capitalism is actually creating a society that is ever-more-egalitarian in nature.
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