Piketty is interesting, yes, but is he right?

That Thomas Piketty's book about wealth and capital is interesting is entirely true. And the world that it describes is perhaps one that we might not like all that much. But we do recall Paul Krugman saying how great a work it is but that it doesn't quite seem to describe this particular world that we inhabit. Certainly, the American economy does not run on inherited capital. Further, the large rise in capital and wealth in both the US and UK economies in recent decades is based upon pensions and housing - not great concentrations of capital at all.

So, interesting, possibly even shocking, but is it true?

Thomas Piketty's Capital in the Twenty-First Century puts forth a logically consistent explanation for changes in income and wealth inequality patterns. However, while rich in data, the book provides no formal empirical testing for its theoretical causal chain. In this paper, I build a set of Panel SVAR models to check if inequality and capital share in the national income move up as the r-g gap grows. Using a sample of 19 advanced economies spanning over 30 years, I find no empirical evidence that dynamics move in the way Piketty suggests. Results are robust to several alternative estimates of r-g.

That's from the IMF. It appears that, whichever world Piketty is describing it's not this one.