Most of the modern rise in the capital share is land, not capital (v2 draft — evidence ledger)

Design-comparison draft (2026-07-15). Same claim and same evidence set as the page of record, restructured so every wired source appears exactly once in one canonical ledger. Not the page of record.

At a glance — When the modern rise in the capital share is decomposed, it is mostly rising housing — and therefore land — value rather than reproducible capital, a result independently replicated across US and European data. Evidence ledger: 10 supporting (5 peer-reviewed or flagship-journal empirical · 2 official-institution · 3 working/conference papers) · 2 challenging (both in top field journals) — all 12 enumerated in the ledger below. Strongest support: Rognlie (2015) — the long-run rise in the net capital share is concentrated in housing; ex-housing, capital's share is roughly flat. Strongest counter: Autor et al. (2020) — reads the falling labor share as a shift toward high-markup "superstar firms," capping how much the land story can claim.

The Claim

The rising share of national income flowing to "capital" in developed economies — popularised by Thomas Piketty's Capital in the Twenty-First Century — is, when decomposed, almost entirely a rise in the housing sector, and therefore largely a rise in land rent. Reproducible capital (machines, equipment, structures) shows little long-run increase in its income share; land does.

The Evidence Ledger

Every source wired to this claim, strongest first. Challenging evidence sits in the same table — the count in the banner is this table, nothing more, nothing less.

How the Evidence Fits Together

The two core studies (ledger #1–2) are direct decompositions: separate teams, different countries, different methods, one conclusion — the "capital" in rising capital shares is mostly location. Three studies supply the chain behind that result: Knoll, Schularick & Steger (#3) provide the price history (the post-1950 house-price boom is a land-price boom); Davis & Heathcote (#4) provide the benchmark US series separating land from structure value; La Cava (#6) traces the income side down to the state level, where supply constraints concentrate the gains — a land-scarcity story.

The remaining supporters corroborate from independent angles: Kerspien, Madsen & Strulik (#5) reach the real-estate reading from two centuries of factor-share data; Bakker (#7) restates the claim from the measurement side (recorded "capital income" is partly land rent); Stiglitz (#8) derives it from theory; Rognlie's 2014 note (#9) is the precursor result; and Furman & Orszag (#10) connect the housing channel to the wider rents debate.

The Counter-Case

The honest counterweight comes from the firm-level literature (ledger #11–12). Autor et al. (2020) explain the falling labor share without land at all: reallocation toward high-markup "superstar firms", read substantially as an efficiency story. Barkai (2020) measures a fall in both the labor share and the required-return capital share in US nonfinancial corporations, offset by rising pure profits attributed to market power, not land. Neither paper rebuts the housing decomposition directly — they work on different data at a different level — but both cap how much of the economy-wide shift away from labor the land story can claim for itself. The wiki's corporate-rents claim page carries that side of the ledger in full.

Why It Matters

If inequality's capital dimension is really a land dimension, a tax on land values targets the actual driver — without the efficiency cost of taxing productive capital. This connects 21st-century inequality research directly to Henry George's 19th-century diagnosis in Progress and Poverty.

Strength of Evidence

Strong. The core result has been independently replicated across US and European datasets by separate teams (ledger #1–2), and the supporting chain runs through three different literatures — price history (#3–4), factor shares (#5–6), and growth accounting (#7) — that do not share data or methods. One caveat the ledger makes visible: the two challengers are published in top field journals, so the counter-case is not fringe; it limits the claim's scope (how much of the labor-share decline land explains) rather than its core (the housing decomposition itself). A second caveat: Kerspien et al. (#5) frame the appreciating asset as "buildings" and leave the land-versus-structure split to the house-price literature — the "buildings are land" step is supplied by Knoll et al. (#3), not by that paper alone.

See Also

Context and adjacent evidence — deliberately not in the ledger because none of it is wired as direct support or challenge:

• McKinsey Global Institute (2021): The Rise and Rise of the Global Balance Sheet — mainstream institutional balance-sheet evidence that real estate dominates global net worth
• Blanco, Bauluz & Martínez-Toledano (2018), Wealth in Spain 1900-2014 — a national case study extending the land-decomposition finding
• Hornbeck & Moretti: who benefits from productivity growth — "the split between labor and land is potentially more consequential... than the split between labor and capital"
• Piketty, Capital in the Twenty-First Century — the dataset the land decomposition reinterprets (context source)
• Economic Rent · Unearned Increment · Land Value Tax

Sources

Every ledger row, in ledger order. Full bibliographic detail and quoted findings live on each linked research page.

1. Matthew Rognlie (2015), "Deciphering the Fall and Rise in the Net Capital Share," Brookings Papers on Economic Activity — used for ledger #1 (housing concentration of the net capital-share rise). wiki summary · PDF
2. Odran Bonnet, Guillaume Chapelle, Alain Trannoy & Étienne Wasmer (2021), "Land is Back, It Should Be Taxed, It Can Be Taxed," European Economic Review — used for ledger #2 (independent European replication). wiki summary · PDF
3. Katharina Knoll, Moritz Schularick & Thomas Steger (2017), "No Price Like Home: Global House Prices, 1870–2012," American Economic Review 107(2) — used for ledger #3 (land prices drive the post-1950 boom). wiki summary · DOI
4. Morris A. Davis & Jonathan Heathcote (2007), "The Price and Quantity of Residential Land in the United States," Journal of Monetary Economics 54(8) — used for ledger #4 (the benchmark US land-price series). wiki summary · DOI
5. Jacob Kerspien, Jakob B. Madsen & Holger Strulik (2025), "Capital Composition and the Decline of the Labor Share: Why Buildings Matter," European Economic Review — used for ledger #5 (capital-composition account of the labour-share decline). wiki summary
6. Gianni La Cava (2016), "Housing Prices, Mortgage Interest Rates and the Rising Share of Capital Income," Reserve Bank of Australia Research Discussion Paper — used for ledger #6 (imputed-rent income channel). wiki summary
7. Bas Bakker (2023), "Unveiling the Hidden Impact of Urban Land Rents on Total Factor Productivity," IMF working paper — used for ledger #7 (measurement-side restatement). wiki summary
8. Joseph E. Stiglitz (2015), "New Theoretical Perspectives on the Distribution of Income and Wealth among Individuals: Part IV: Land and Credit," NBER Working Paper 21192 — used for ledger #8 (theoretical derivation). wiki summary
9. Matthew Rognlie (2014), "A Note on Piketty and Diminishing Returns to Capital," working note — used for ledger #9 (the precursor result). wiki summary
10. Jason Furman & Peter Orszag (2015), "A Firm-Level Perspective on the Role of Rents in the Rise in Inequality," conference paper — used for ledger #10 (partial support; housing-rents channel). wiki summary
11. David Autor, David Dorn, Lawrence Katz, Christina Patterson & John Van Reenen (2020), "The Fall of the Labor Share and the Rise of Superstar Firms," Quarterly Journal of Economics 135(2) — used for ledger #11 (the superstar-firms counter-reading). wiki summary · NBER
12. Simcha Barkai (2020), "Declining Labor and Capital Shares," The Journal of Finance 75(5) — used for ledger #12 (the market-power counter-reading). wiki summary · DOI