Growing importance of land is bad news for the economy

FOR all the alarm about the "rise of the robots" or "software eating the world" or the peril of climate change, one of the most pressing economic dangers of the future is getting short shrift: Landlords are eating the world.

There is growing concern that wealth inequality has skyrocketed, and that capital income accounts for a growing share of the economic pie. This was the theme of Thomas Piketty's Capital in the Twenty- First Century. But although we usually think of "capitalists" as they were defined by Karl Marx - i.e. owners of corporations - we forget that land also is a form of capital, which means landlords (and homeowners) are capitalists, too.

Furthermore, according to Matt Rognlie, an economics PhD student at the Massachusetts Institute of Technology, it is land, not corporate capital, that has been responsible for the lion's share of the increase in capital's share of income.