former. I neglected “government wealth” net of national debt, which is small and often negative, as I don’t feel that I understand it well enough. I took consumption as the sum of personal consumption expenditure (PCE) and government consumption expenditure (GCE). I also downloaded real stock market rates of growth, dividends
and return from the Global Financial Data website for the same years and countries.
Yearly change in capital in each country gave each year’s capital growth as a flow. I added this to consumption to give what call market-valued output. I said earlier that Piketty and Zucman should logically have done the same. This gave the values
for (4.1) and (4.1a).
I then divided by year-end capital to give values for (4.3). 1 next found annual changes in those three to give acceleration, productivity gain and thrift gain as shown in (4.5) and (4.5a), and divided by acceleration to find the two indexes of
(4.6) and (4.6a).
The test from Global Financial Data took fewer steps. Stock market growth rate, rate of return and dividend rate were downloaded directly. | took them as corresponding respectively to growth rate, capital productivity and consumption rate in (3.3a). | found their annual changes to find values for (3.4a), and again divided by
acceleration to reach (3.5a).
This allows tests of Mill’s idea from national accounts data for all eight nations reported at the Piketty-Zucman website, and over their entire reporting periods through 2010. (The website also reports for Spain, but only since 1993 and without data for consumption.) In each year, for each country, change in capital growth rate is compared to change in consumption rate (consumption/capital). If consumption rate grows faster than capital growth rate while both grow, or declines faster if both decline, the free growth index in that year is greater than one. If they change at the same rate in the same direction it is one exactly. If both change in the same direction,
but consumption changes less, the free growth index is between zero and one. If
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