Capital in the Twenty-First Century

The size of the stock of accumulated wealth relative to the flow of income. A high capital/income ratio implies a society dominated by past wealth.

One hundredth, or one percent, of a population or group.

In statistics, a specific group distinguished from other cohorts. In sociology and economics, this typically refers to an age cohort, for example, anyone born in the 1970s.

One tenth, or ten percent, of a population or group

Gross domestic product. GDP is the total amount, in terms of economic value, that a nation produces in a year. This is related to but distinguishable from national income.

In economics, the total amount, in terms of GDP, that an economy grows in a given period. This can be broken down into demographic growth, growth in population, and per capita growth, which is growth in average productivity.

The dimension of government economic policy concerned with taxation and government spending. Fiscal is contrasted with monetary.

The extra amount of product and value that an additional worker brings to a firm or economic institution. In classical economic theory, a worker’s wages should equal their marginal productivity.

The element of government economic policy concerned with inflation, interest rates, and the flow of money. Monetary is contrasted with fiscal.

The total amount a nation has available to spend in a year. This is equal to the total amount a nation produces in a year (GDP) minus the cost of replacing capital plus net foreign income.

The economic and political doctrine which argues that economies works best when government intervention in or regulation of markets is kept to a minimum. It is the dominant ideology of most developed nations since the 1980s.

A tax which takes a proportionally higher amount from someone the richer they are. Income taxes are frequently an example of this.

A tax which takes an identical proportion from someone regardless of wealth or income. For example, a twenty percent tax on all income would be proportional.

The policy of protecting the industries of one’s own nation from foreign competition. This is typically done by means of tariffs on foreign goods.

A tax which takes a greater proportion from someone who earns or possesses less. Consumption taxes on alcohol or cigarettes are usually regressive, charging everyone the same nominal amount regardless of income or wealth.

A now pejorative term for someone who makes their living from the return on non-productive capital. This capital could take the form of government bonds, land, or real estate.

Related to (but not to be confused with) the capital stock. The return on capital is the income that one can derive from one’s assets, for instance in the form of rents or dividends. This may be used to re-invest in capital or for consumption.

The type of state that developed in Europe and the US after World War II which involves responsibilities including education, health, and social welfare that are beyond the traditional functions of defence, law, and order.