Piketty Thinks the EU Is Bad for Eastern Europe. He's Half Right.

Rock star economist Thomas Piketty's view of eastern European countries as "owned" by their wealthier Western neighbors has helped nationalist parties in that part of the world make a case for economic decolonization. But Piketty's arguments as he frames them are rather easy to dismiss -- which is a problem: There are stronger ones to be made.

Last month, Piketty used his blog on the center-left French daily Le Monde's web page to argue that European Union membership may not have been net beneficial for countries such as Poland, Hungary, the Czech Republic and Slovakia. He compared these countries' net outflows of profits and incomes from property with the net transfers they have received from the EU and finds that the outflows have been higher. "Of course, one might reasonably argue that Western investment enabled the productivity of the economies concerned to increase and therefore everyone benefited," Piketty wrote. "But the East European leaders never miss an opportunity to recall that investors take advantage of their position of strength to keep wages low and maintain excessive margins."