Reflections on housing, Property price booms and inequality in response to Thomas Piketty's Capital in the XXIst century

Odran Bonnet, Pierre Henri Bono, Guillaume Chapelle, Etienne Wasmer

Research output: Contribution to journalReview article


In his book, Capital in the 21stCentury, Thomas Piketty highlights the risk of an explosion of wealth inequality because capital is accumulating faster than income in several countries such as France. Our work challenges the conclusions of the author. First, the author's result depends on the rise of only one of the components of capital, namely housing capital, and due to housing prices. In fact, housing prices have risen faster than rent and income in many countries. It is worth noting that "productive" capital, excluding housing, has only risen weakly relative to income over the last few decades. Over the longer run, the "productive" capital/income ratio has not increased at all. Second, rent, not housing prices, should matter for the dynamics of wealth inequality, because rent represents both the actual income of housing capital for landlords and the dwelling costs saved by "owner-occupiers" (people living in their own houses). This does not mean that housing prices do not contribute to other forms of inequality.

Original languageEnglish (US)
Pages (from-to)317-346
Number of pages30
JournalRevue d'Economie Politique
Issue number3
StatePublished - Jan 1 2015



  • Housing - capital - wealth - inequality

ASJC Scopus subject areas

  • Political Science and International Relations

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