One secret to Thomas Piketty’s success in selling Americans his book Capital in the Twenty-First Century is his embrace of great literature. Piketty retells key moments in Honore de Balzac’s Pere Goriot to illustrate the importance of inheritance in the 19th century and draws on Jane Austen’s Mansfield Park when he discusses the value and the vexation of overseas investments. Piketty’s insight is that books capture the sense and flavor of their era—and occasionally report typical prices and incomes.
The writers of the past are equally valuable for illuminating the astounding progress of economic growth in the past two hundred years, a fact Piketty acknowledges but to which he devotes little ink. Reading Capital, one comes away with the impression that the distribution of wealth and income is the central fact of each era: He reports most statistics as percentages of national income. But when per-person national income was doubling every generation, it was surely a more noticeable phenomenon than a few percentage points of national wealth more or less in the portfolios of the top centile.
Long-term comparisons of income levels are tricky: How many buggy whips is an iPhone worth? Stories of human life under different conditions can help us appreciate the immensity of growth.
In One Thousand and One Nights, hilarity ensues when characters meet in the dark and fail to recognize one another. Artificial light was expensive. Roger Fouquet and Peter J. G. Pearson estimate that a dollar’s worth of lighting in the year 2000 would have cost $3,000 two centuries before. Like all long-term economic growth, the cheapness of modern light comes from applying free enterprise to technological innovation. At times, the British government stood athwart history, taxing windows and Dutch whale oil. [“Seven Centuries of Energy Services: The Price and Use of Light in the United Kingdom (1300-2000)“ by Roger Fouquet and Peter J.G. Pearson, The Energy Journal, Vol. 27, No. 1 (2006)]
In Little Women, Beth March dies of strep throat (scarlet fever) despite being an affluent New Englander. Today, an antibiotic would have cured her quickly, and the entire episode might warrant a few Facebook status updates. Oliver Twist is thrown into a life of poverty and loneliness by the death of his mother in childbirth, a common occurrence in 19th-century London. The advances in medicine alone make the era of enterprise and innovation a success.
Jules Verne’s Around the World in Eighty Days celebrates the breakneck speed of an era of dynamic growth and technological progress. Steam, rail, and telegraphy remade the world in a generation.
Although Piketty has introduced some new data on the distribution of income and wealth in different eras, we should not lose sight of the great progress that has lifted all standards of living since the times of Charles Dickens and Jules Verne.
—by Salim Furth