Two Hundred Years of Wealth and Inequality in Paris

Wealth inequality has bedeviled society for centuries, and in many places around the globe, the gap between the haves and have-nots continues to grow. To help shed light on some of the forces at work in this challenging issue, the latest book by Caltech's Jean-Laurent Rosenthal (PhD '88), the Rea A. and Lela G. Axline Professor of Business Economics and director of the Ronald and Maxine Linde Institute of Economic and Management Sciences, explores the interplay among wealth, inequality, and welfare through the lens of 19th- and 20th-century Paris.

A Capital's Capital: Two Hundred Years of Wealth and Inequality in Paris, published February 3, 2026, investigates French wealth and its distribution using information from almost two centuries of estate bequest records. Nearly 25 years in the making, the book features insights Rosenthal garnered by combing through and analyzing a unique collection of data from roughly 800,000 Parisians.

Rosenthal's long-term aim has been to understand what institutions encourage long-term economic growth and how they influence wealth formation. While in Paris on a Guggenheim Fellowship in 2001, Rosenthal was reading a book by French economist Thomas Piketty on income inequality in France, and he began to question some of the ideas being posited.

"I realized he was saying things about the 19th century that required more evidence," Rosenthal says. So, he and colleague Gilles Postel-Vinay, professor emeritus at the Paris School of Economics and coauthor of A Capital's Capital, began a conversation with Piketty about the need for better data to support his claims, and a seed was planted.

"As social scientists, if you want to ask important questions, you kind of have to build your own observatory," says Rosenthal, who notes Piketty went on to play a significant role in early research that impacted many of the book's findings.

To build their observatory and perform in-depth analyses of the fluctuations in wealth and its distribution in Paris for a period that eventually spanned from 1807 to 1977, Rosenthal and Postel-Vinay drew on estate data recorded at the time of death for residents of the city.

"We realized that France is very unusual relative to the rest of the world because, until 1956, all estates were taxed, so everybody with a savings account is in the data," Rosenthal explains. "For the right set of people, we could collect their portfolios to try to understand how wealth was being changed."

Rosenthal says the work focused on Paris because it is a location that had both extremes one would want to capture: very high wealth and devastating poverty. By looking at data over a long timescale, the authors were able to see how real wealth varied by date and map the economic, political, and demographic factors that influenced both wealth accumulation and inequality through the years.

For example, because of French legal rules governing community property, the data reveal both the wealth that married individuals bequeath to others and what she or he inherited years before. In the low-tax environment of the 19th century, children paid a tax of less than 2 percent of the value of their inheritance, and the share of inherited wealth was very high (up to 70 percent). But after World War I, the share of inherited wealth fell due to a combination of macroeconomic and fiscal factors.

"The biggest shock for us was that you can move the wealth of a society up or down really fast, but moving inequality is a generational problem," Rosenthal says. "For example, World War I had no effect on wealth distribution whatsoever. It hit everybody in absolute losses and is the largest of the 'shocks' we saw during the time we studied. The Great Depression then starts to have an effect on inequality, and World War II does too, but from the beginning of the 1800s to the end of the 1970s, Paris is an incredibly unequal city."

He notes that many of the transformations seen in Paris similarly echo changes in the global—and the US—economy since 1800.

"Paris's experience can even help us think about the trajectory of inherited wealth in the US in the 21st century, when each individual can transmit an estate of $15 million free of estate taxes," Rosenthal says.  

Another striking pattern he points to is the tight connection between the spatial distribution of wealth within Paris and other indicators of welfare such as age at death, access to education, diffusion of water infrastructure, and exposure to disease. Although the spatial distribution of wealth over several generations persistently predicts differences in mortality across Parisian neighborhoods, the variance of mortality falls dramatically at the start of the 20th century after public intervention begins to isolate people with tuberculosis, an epidemic that had ravaged the city across all social classes for decades. 

"Paris demonstrates time and again that the growth of the city's wealth plays second fiddle to public spending in limiting the severity of welfare disparities," Rosenthal says.

Furthermore, the dynamics outlined in the book that contribute to wealth creation and distribution, such as generational wealth via inheritance, changes in saving strategies, and the relation between private wealth and public wealth, continue to have an impact.

"There's all sorts of things that lead inequality to be persistent, but one thing that really drives it is a combination of technology and market changes that are all going in one direction, and that persists today," Rosenthal says. "Society is fighting a trend that the scale of businesses is growing and creating a wealth accumulation only for the founders."

In addition to writing a book about their findings, Rosenthal and Postel-Vinay have made their data available to scholars who may want to build upon—or scrutinize—their work.

"We've made available the dataset upon which we wrote the book, as well as a unique ID for every individual in the dataset that anyone might be interested in," Rosenthal says. "We also have the raw data for all the information we collected, so if you don't like the way we made the sausage, you can go back and remake the sausage for any one individual, however you want."

Rosenthal hopes A Capital's Capital will appeal to anyone curious about wealth and equality dynamics and how they can change over time using the data of real people who experienced the real-life consequences of both prosperity and poverty. "If you're interested in welfare, you really need to know something about wealth, because wealth is correlated with a zillion sets of outcomes, even down to the neighborhood level," he says.