r>g, Piketty, what a man. I think your claim that a wealth tax would disincentivise innovation is very underdefended and I mostly disagree with it. OK wealth taxes will at some point disincentivise innovation (100% walth tax ie banning private property ie communism seems to do this) and it makes sense that there would not be a discontinuity and that then even a ~6% wealth tax would be slightly disincentivising. But I think this would be a pretty tiny effect? Also, imagine you are a billionaire in a country with a 6% wealth tax: because of loss aversion you may actually be more motivated to invest effortfully to avoid going backwards, and thus contribute more value to the efficient market.
r>g, Piketty, what a man. I think your claim that a wealth tax would disincentivise innovation is very underdefended and I mostly disagree with it. OK wealth taxes will at some point disincentivise innovation (100% walth tax ie banning private property ie communism seems to do this) and it makes sense that there would not be a discontinuity and that then even a ~6% wealth tax would be slightly disincentivising. But I think this would be a pretty tiny effect? Also, imagine you are a billionaire in a country with a 6% wealth tax: because of loss aversion you may actually be more motivated to invest effortfully to avoid going backwards, and thus contribute more value to the efficient market.