## Making Progress

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**Canonical URL:** [Making Progress](https://www.imf.org/-/media/files/publications/fandd/article/2022/september/book-dabla-norris.pdf)

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### Thesis and scope
- Review of Thomas Piketty’s A Brief History of Equality (Translated by Steven Rendall).
- Argues that human societies have moved toward measurable improvements in quality of life and fairer distribution of income and assets, while noting that novel solutions are required to address current inequities.
- Emphasizes the political, social, and institutional contexts that shaped the origins and evolution of inequality.

### Historical turning points and mechanisms of redistribution
- The period 1914 to 1980 is identified as a “great redistribution” marked by dramatically reduced income and wealth inequalities across much of the Western world.
- Major drivers of this redistribution included:
  - The two world wars and the dislocation of the Great Depression.
  - Rise of the welfare state, which expanded access to education, health care, transportation, old-age pensions, and insurance—expenditures that disproportionately benefited lower- and middle-class people.
  - Progressive taxation of income and wealth that lowered concentration of wealth and economic power at the top, leveling both pre- and posttax inequalities and securing collective acceptance of a new social and fiscal contract.
  - Universal suffrage and electoral competition, supported by an independent press and the labor union movement, which helped ensure majoritarian prosperity.
  - Liquidation of colonial assets and cancellation of public debts accumulated during the interwar periods, freeing resources for reconstruction and redistribution.

### Fiscal capacity and numeric evidence
- Revenue mobilization rose from less than 10 percent of national income in 1910 to between 30 and 40 percent by the century’s middle decades.
- The “leap forward” toward greater equality was enabled by this unprecedented increase in public revenues.

### Recent reversal and structural causes
- Since the 1980s, there has been sharply rising concentration of incomes and wealth and persistence of inequity in all its forms.
- Causes identified include:
  - Financial liberalization and deregulation.
  - Loopholes in the international tax system.
  - Political capture as political power and economic resources increasingly coalesce.
  - Adverse effects observed in both advanced economies and the global South.

### Proposed solutions and policy agenda
- Return to greater fiscal progressivity, including:
  - Significantly steeper income tax rates on high earners.
  - A global wealth tax on the well-off.
  - Basic income programs.
  - Cancellation of debts.
- Institutional and governance reforms:
  - Publicly financed elections.
  - Worker involvement in the management of large enterprises.
  - A welfare state that extends beyond national borders.
  - Revision of global treaties to address climate change and the unequal distribution of wealth.
- Piketty’s view: Past experience suggests that “a profound transformation of the world economic system” is possible.

### Publication details
- Author reviewed: Thomas Piketty.
- Book title: A Brief History of Equality.
- Translator: Steven Rendall.
- Publisher: Belknap Press, Cambridge, MA, 2022.
- Length and price: 274 pp., $27.95.

*Review by Era Dabla‑Norris, assistant director, IMF Asia and Pacific Department*

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_Source: https://www.imf.org/-/media/files/publications/fandd/article/2022/september/book-dabla-norris.pdf_