Piketty and Marx

In a recent interview to Isaac Chotiner from the New Republic, Thomas Piketty makes interesting remarks about the relation between his work and Marx’s writings, Capital in particular:

TP: I never managed really to read it. I mean I don’t know if you’ve tried to read it. Have you tried?

IC: Some of his essays, but not the economics work.

TP: The Communist Manifesto of 1848 is a short and strong piece. Das Kapital, I think, is very difficult to read and for me it was not very influential.

IC: Because your book, obviously with the title, it seemed like you were tipping your hat to him in some ways.

TP: No not at all, not at all! The big difference is that my book is a book about the history of capital. In the books of Marx there’s no data.

I did wonder about the title, “Capital,” phrases that echo Marx’s famous “le mort saisit le vif” (quoted by him in French in his German original), “The tradition of all dead generations weighs like a nightmare on the brains of the living” (in Marx’s pamphlet on the French 18th Brumaire), the allusion (though in an entirely different context and with a different conceptual meaning) to the “metamorphosis of capital,” etc. So, apparently, all that came to Piketty indirectly, since he just couldn’t get over the difficulties of reading Marx’s radical critique of political economy.

Oh well, in all fairness, Marx did warn readers that his Capital was no easy read, “no royal road to science,” “if the essence of things coincided with their appearance, science would be superfluous,” etc. But I am taking Piketty’s answers as off-the-cuff remarks by a guy overwhelmed by sudden attention, not necessarily undeserved. Piketty’s work has much merit, and the timing is just right, so his apparent disregard for Marx’s massively important work cannot take this away. But, said with all due respect, Piketty is no Marx.

In fact, lack of data was common to political economy and economics works at least until Piketty’s heroe Simon Kuznets’ work. We can say the same or worse about Smith or Ricardo or Mill or the founders of the “marginal” school. The data Kuznets, Mitchell, Burns, etc. developed, and even the “large” databases we now have (including Piketty’s and collaborators) are still almost entirely “observational” (let alone self- reported) data that does not speak for itself.

Almost heroic structure has to be imposed on “observational” (as opposed to “experimental”) data to torture and make it confess, and that structure is a hypothetical edifice with serious limitations, if you pause and reflect about the underpinnings of probability theory and inferential statistics. I am tempted, at this point, to respond to Piketty’s dissing (in his Capital) of theoretical models seemingly without direct empirical reference, but I will keep that for latter.

In spite of the limitations Marx faced in his time, he did scrutinize every statistical table that ever got in his hands, squeezed the English official “blue books” with copious details on factory life, as well as technical and accounting data his friend Engels collected on his own factory. Marx admired greatly William Petty and any other predecessor who compiled useful statistics, and made use of mathematics for empirical or theoretical purposes, and — isn’t it obvious? — the man was capable of extracting more information from small samples and casual observations (yes, including the works of the great classics and the “fiction” writers of his time, something that also made me suspect of Karl’s influence on Thomas’ work) than any Google data-mining algorithm ever known. All this is, of course, of biographical importance, but not very relevant to our understanding of capital before and after. In the latter inquiry, Marx and Piketty should be viewed as “complementary” (not “substitute”) goods.

I have much more to say about Piketty’s Capital, its merits and demerits, but I will reserve that for a future entry.

UPDATE: John Judis (from the New Republic) says that Piketty has, of course, read Marx.  He’s just pulling the leg of naive Americans who get scared at the casual mention of Marx.  Who knows?  But Piketty doesn’t strike me as the sarcastic type. I’d discount things this way if they came from, say, Robert Solow, who famously quipped: “Everything reminds Milton Friedman of the money supply.  Everything reminds me of sex, but I try to keep it out of my papers.” But it is not impossible that Piketty is joking.

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