cabal install -j foo will build and install foo and its dependencies in parallel, it works on the package level.
$ cabal build -j doesn't use the -j flag (or maybe just passes it to GHC), but it doesn't build the different package components in parallel. It'd be great if it would build all your executables, tests and benchmarks in parallel instead of in sequence as today.
The extra parallelism would be very useful when you're developing a package and you constantly recompile your single package (not its dependencies).
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