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2026-08-04

• Mamdani’s not the first to try to bring cheap groceries to N.Y.C.
  by Matthew Yglesias in Slow Boring, 2026-08-04 10:02:35 UTC

  A Walmart in Maryland. Walmart spent years trying to enter New York City but was unsuccessful. (Photo by Alexander Farnsworth via Getty Images) As Zohran Mamdani inches forward with his plan to introduce low-cost government-run grocery stores in New York City , I think it’s worth noting that he’s far from the first person to have noticed that the city’s supermarkets are unusually expensive or to have thought it might be a good idea to try to bring in some lower-cost options. The most prominent attempt to do this was not by a democratic socialist or even a mayor, but rather a businessman workin [...]

2026-08-03

• How does seasonal weather affect construction employment?
  by ? in FRED blog, 2026-08-03 13:00:00 UTC

  The FRED Blog has discussed why employment in retail and postal services peak around the Christmas holidays. Today we tap into a 2018 research piece from the Federal Reserve Bank of Chicago to discuss why construction employment may follow different patterns across states. Our FRED graph above shows monthly employment data reported by the US Bureau of Labor Statistics. The solid lines are the numbers (in thousands) of employed workers in construction between May 2016 and June 2026 in two states: Kentucky in purple and Minnesota in blue. The dashed lines are the same employment figures adjuste [...]

2026-07-17

• Book Review: "Power and Progress"
  by Noah Smith in Noahpinion, 2026-07-17 03:52:55 UTC

  My elderly rabbit Giggles has unfortunately been quite sick the past two days (he’s recovering now), so I haven’t had as much time to write. Instead I thought I would repost a book review I did two years ago . I’ll be back with more original content tomorrow! In my post yesterday about the “We Must Act Now” statement, I noted that Daron Acemoglu successfully got the writers to alter some key language in exchange for his signature — most likely, adding the “steering” idea that I took issue with. Technological “steering” is the central policy recommendation of Acemoglu’s 2023 book Power and Prog [...]

2026-07-13

• The American suburbs are better than you think
  by Noah Smith in Noahpinion, 2026-07-13 12:38:16 UTC

  “Buy a big house and live in the suburbs” — Tracy Chapman “Outside suburbia’s sprawling everywhere/ I don’t want to go, baby” — Kim Wilde I grew up in the suburbs, and when I got the chance, I moved to a big city and never looked back. 1 I love living in dense, built-up urban areas, with great train systems and tons of restaurants and shops. Japanese cities are the best in the world, and I’ve written plenty of posts about what makes them so great . But you don’t have to be Japan in order to create amazing metropolises — New York City, Paris, Istanbul, Seoul, London, etc. are all excellent plac [...]

2026-07-06

• What US assets are held overseas?
  by ? in FRED blog, 2026-07-06 13:00:00 UTC

  The FRED Blog recently discussed who holds Treasury securities in the US and abroad. Today, we answer a related question: How do Treasury securities fit into the overall portfolio of US financial assets held overseas? Our FRED graph above uses data from the Treasury International Capital (TIC) system to show the class shares of US financial assets held overseas. In April 2026, those asset classes were (in descending order) Equities (blue area). Common stock, preferred stock, and fund shares of US corporations made up 59.4% of the overall portfolio of US financial assets held overseas Long-te [...]

• Is the dollar in danger of losing its supremacy?
  by Dalton,A in LSE Review of Books, 2026-07-06 11:14:28 UTC

  Kenneth Rogoff’ s Our Dollar, Your Problem explores how the US dollar has maintained its position as the world’s dominant currency. Combining economic history, geopolitics and monetary economics, Rogoff explains dollar dominance with institutional credibility, financial depth and America’s power. The book offers an eagle-eyed ,critical view of the evolving global financial landscape, writes Srishti Gupta . Our Dollar, Your Problem: An Insider’s View of Seven Turbulent Decades of Global Finance, and the Road Ahead. Kenneth Rogoff. Yale University Press. 2025 (hardback); 2026 (paperback). [...]

2026-06-29

• AI investment and semiconductor prices
  by ? in FRED blog, 2026-06-29 13:00:00 UTC

  The takeaway Although data center construction and semiconductor purchases are both related to the AI boom, changes in their prices may be occurring at different stages of the investment process.   Producer price index Our FRED graph above shows the producer price index for semiconductor and other electronic component manufacturing. This index measures prices received by domestic producers in that industry. For much of the recent past, the index had changed slowly, even during periods when semiconductor shortages received wide attention. But that pattern has changed: The index rose from 61.6 [...]

• Migrants vs natives vs machines
  by Johan Fourie in Our Long Walk, 2026-06-29 06:02:27 UTC

  In the autumn of 1965, something was missing from the tomato fields of California. For two decades, close to half a million Mexican men had crossed the border each year to pick the crops that Americans ate. They were called braceros – hired hands, brought in under a government programme that had started during the war. Then, on the last day of 1964, Washington closed the programme down. The braceros went home. Politicians had promised this would be good news for American workers. Take away the foreigners, the argument ran, and farmers would have no choice but to offer better wages to the local [...]

2026-06-23

• Lessons of Brexit
  by Chris Dillow in Chris Dillow, 2026-06-23 07:51:51 UTC

  Today is the tenth anniversary of the vote to leave the EU - one of the worst political decisions in living memory. It’s not just those experts of whom people have had enough who believe this. So too do the voters. According to Yougov , 57% think we were wrong to vote to leave the EU, including 23% of Leave voters. And only 12% think Brexit has been a success. Our biggest political decision in years, taken after months of extensive public debate, was therefore mistaken. Unlike other bad decisions, such as the Truss/Kwarteng Budget or the election of a succession of inadequate prime ministers, [...]

2026-06-22

• Urbanisation, megaprojects and dispossession in Asia
  by Dalton,A in LSE Review of Books, 2026-06-22 11:22:34 UTC

  The Political Economy of Megaprojects in Asia edited by Hyun Bang Shin and Dong-Wan Gimm critiques the megaproject as the dominant model of urban development across Asia. Through interdisciplinary case studies in South Korea, China, Taiwan, India, Turkey, and Malaysia, this compelling, nuanced volume reveals how states, private capital and various actors reshape urban landscapes through large-scale infrastructural and real-estate projects, writes Sara Bardhan . The Political Economy of Megaprojects in Asia: State Power, Land Control, Financial Flows, and Dispossession. Hyun Bang Shin and Do [...]

2026-06-19

• Colorado’s Funeral Mistake
  by ? in Marginal Revolution, 2026-06-19 11:20:08 UTC

  Today about a quarter of the US workforce are required to have a license to work in their chosen profession, up from just 5 percent in 1950. Almost always the trend has been to add occupational licensing over time, but in 1983 Colorado did something unusu… [...]

2026-06-18

• AI versus the China Shock
  by Adam Ozimek in Agglomerations, 2026-06-18 10:31:34 UTC

  To hear an extended conversation about the themes in this post, please subscribe and listen to our podcast, The New Bazaar . The China Shock refers to the widespread job loss that certain workers and communities suffered because of the rapid rise of trade with China in the 2000s. The AI Shock refers to the same thing happening to white collar workers from the rise of Artificial Intelligence. For now, the AI Shock is merely a potential shock. But a number of economists , journalists , and other experts have drawn worrying parallels between these two shocks. We understand why. Across a large bod [...]

2026-06-17

• What Set-Asides Cost: A Lesson from Timber Auctions.
  by noreply@blogger.com (Luke Froeb) in Managerial Econ, 2026-06-17 17:44:21 UTC

  California's Public Utilities Commission is pressuring utilities to steer about 1.5% of procurement toward state-certified "LGBT-owned" firms.  Setting aside the certification debate, what will this cost the state?  In every auction, the winner has to outbid the second-best bidder, so the second-best bidder sets the price. Weaken the field and you weaken that price-setter. But which way the price moves depends on whether the government is buying or selling. When the government buys, it runs a procurement auction: bidders compete to sell to the government, and the lowest-cost bidder wins, whi [...]

2026-06-15

• Who holds US Treasury securities overseas? : Data from the TIC system
  by ? in FRED blog, 2026-06-15 13:00:00 UTC

  The majority of Treasury securities are held by the American public and institutions , including the Federal Reserve. FRED recently added data from the Treasury International Capital (TIC) system. As the name implies, this dataset provides a global scope. In March 2026, the nine largest foreign holders of U.S. long- and short-term Treasury Securities were (in descending order) Japan United Kingdom China, Mainland France Canada Belgium Ireland Cayman Islands Luxembourg This May 2026 FEDS Note by Andrew McCallum et al. highlights that “these nine countries collectively hold about 45 percent o [...]

2026-06-10

• What bond market constraint?
  by Chris Dillow in Chris Dillow, 2026-06-10 08:39:06 UTC

  “The cost of government borrowing” writes MP Yuan Yang “constrains policy decisions”. She’s partly right, but this should not greatly trouble the left. First, we must recognise that to a large extent the bond market constraint is in fact an inflation constraint. If a government were to borrow significantly more, bond investors would fear that the higher aggregate demand would raise inflation. This would lead either to expectations of higher interest rates as the Bank of England tried to control inflation, or to fears that their gilts would be redeemed in pounds that were worth less. Either wou [...]

2026-06-08

• From Potential Output to Full Employment: A Paradigm Shift for Italian Fiscal Policy
  by Davide Romaniello, Antonella Stirati in INET Blog, 2026-06-08 16:38:41 UTC

  Europe’s new fiscal rules still bind policy to fragile estimates of potential output. For Italy, targeting lower unemployment could sustain stronger growth, improve deficit outcomes, and expose the self-defeating logic of austerity when debt is measured against a stagnating economy. 1. Introduction In 2024, the European Union introduced new fiscal rules. But the changes are more apparent than real and do not address the limitations highlighted by the European Fiscal Board in 2019. In a recent paper we critically examine the new rules and assess ho [...]

• Understanding the various US debt-to-GDP ratios : Similar data series tell slightly different stories
  by ? in FRED blog, 2026-06-08 13:00:00 UTC

  Headlines earlier this year reported that federal US debt exceeded the size of the US economy. Another way to put that: The US debt-to-GDP ratio is over 100%. Opinions and economic analysis vary about what a sustainable fiscal path looks like in the United States. And the multiple data series in FRED that track the US debt-to-GDP ratio also vary. This post provides some clarification and guidance on understanding this ratio in its many forms and expands the descriptions from a 2025 blog post on this topic. US public debt and intragovernmental transactions Our FRED graph above shows three data [...]

2026-06-04

• I'm kind of over the whole "Anti-monopoly" movement
  by Noah Smith in Noahpinion, 2026-06-04 05:52:29 UTC

  For many years, I was a big proponent of the idea that increased market power was harming the U.S. economy in various ways. In the 2010s, in the economics world, circumstantial evidence began piling up that implicated increased industrial concentration as the culprit in a variety of recent negative trends. Here’s what I wrote in 2017 , after reading a bunch of that evidence: [B]asically I see the case of the Market Power Story - or any big economic story like this - as detective work. We’re collecting circumstantial evidence, and while no piece of evidence is a smoking gun, each adds to the ov [...]

2026-05-27

• The great helmsman?
  by Scott Sumner in The Pursuit of Happiness, 2026-05-27 16:36:31 UTC

  [Long time readers will recognize part 1—how to steer the (nominal) economy down the center of the road. Part 2 will look at how to move the road.] Part 1: The Great Helmsman So now we are being told that an increase in interest rates is a virtual certainty. Here’s Bloomberg : As Kevin Warsh takes the helm at the Federal Reserve, bond investors are betting he’ll prioritize the central bank’s inflation-fighting credibility over President Donald Trump’s push for lower interest rates. With the Iran war unleashing the biggest inflation surge since 2023, traders are pricing in that the Fed is vi [...]

2026-05-21

• How are benchmark borrowing costs measured? : A close look into the 10-year Treasury yield
  by ? in FRED blog, 2026-05-21 13:00:00 UTC

  The takeaway The market value of US Treasury securities is considered a benchmark for setting other borrowing costs, such as mortgages. It’s considered a benchmark because the US government has not failed to make good on its Treasury debt obligations. So it serves as a baseline for determining the value of other types of securities with higher default risks. Defining the value of Treasury securities Because of its importance to financial markets, the “market yield on US Treasury securities at 10-year constant maturity, quoted on an investment basis” is one of the most popular series in FRED. [...]

• Financial markets point to very data-dependent monetary policy
  by BankUnderground in Bank Underground, 2026-05-21 08:00:00 UTC

  Nades Raviraj and Danny Walker Big and uncertain shocks have pushed UK inflation above the 2% inflation target over the past few years. How did financial markets view the Monetary Policy Committee’s (MPC’s) monetary policy during this unprecedented period? We show that markets have come to perceive the MPC’s policy stance as increasingly dependent on data releases. In particular, the responsiveness of UK market rates in tight windows around data releases rose significantly from 2022 to 2025. Zooming out to longer time windows in between MPC meetings, the change in services inflation ex [...]

• Roundup #82: Staring in wonder at the world
  by Noah Smith in Noahpinion, 2026-05-21 06:51:31 UTC

  Photo by NASA via Wikimedia Commons I waited too long to do this roundup, and the amount of interesting stuff built up to truly vast proportions. So let’s get right to it. 1. Crime is down! I often get annoyed with people who trumpet falling crime in American cities. Often, these same people are silent in the years when crime rises — for example, 2015-2021. This means that all those cries of “Crime is down!” might only bring us back to where we were before. Also, even when crime falls in America, it still generally leaves us about 5x as violent as Europe . People who use crime drops to wave aw [...]

2026-05-19

• Words and deeds in the Indian exchange rate
  by Anurodh in Ajay Shah's blog, 2026-05-19 05:31:06 UTC

  by Rajeswari Sengupta and Ajay Shah. The most important price in any economy is the exchange rate. In India's case, this is the price of the Indian rupee against the US dollar. By default, the exchange rate is controlled by market forces. The policy stance of the government, towards the exchange rate, is termed 'the exchange rate regime'. This is one of the most consequential economic policy choices. In most advanced economies, the answer is straightforward: the exchange rate is set by financial markets, and the government stays out. In India, it is more complicated. The RBI regularly in [...]

2026-05-14

• The Great Forgetting
  by Scott Sumner in The Pursuit of Happiness, 2026-05-14 18:08:13 UTC

  Noah Smith has a very good post on development economics, which contains the following list: The field of economics doesn’t lack for big ideas about why countries go from poverty to riches. These include: Institutions: The idea that property rights, legal frameworks, and other systems of human organization are long-lasting (“sticky”) and are crucial for development Geography: The idea that countries’ natural endowments — navigable waterways, farmland, proximity to other regions, etc. — determine which place gets rich Human capital: The idea that skills — reading, math, etc. — and population [...]

2026-05-11

• The peculiar recent behavior of unemployment
  by ? in FRED blog, 2026-05-11 13:00:00 UTC

  Our FRED graph above shows that unemployment is almost always doing one of two things: (1) declining slowly during expansions or (2) rising rapidly during recessions. Friedman ( 1964 , 1993 ) compared this behavior to playing a musical instrument, describing it as a “plucking model” of unemployment. Over the past 3 years, however, the unemployment rate has done something it almost never does: It has risen slowly from a low level, but there has been no sharp rise accompanied by a recession. Our non-FRED graph below* illustrates how unusual this behavior is. The jagged red line is [...]

• Why can’t we just print more money?
  by Dalton,A in LSE Review of Books, 2026-05-11 10:02:57 UTC

  Modern Monetary Theory (MMT) claims that governments could fill revenue gaps for key projects like unemployment programmes and energy security without raising taxes: they could simply print more money, with certain precautions in place. But could this really work? Emmanuel Maggiori draws on his new book, If You Can Just Print Money, Why Do I Pay Taxes? to interrogate MMT’s boldest claims. If You Can Just Print Money, Why Do I Pay Taxes? Modern Monetary Theory Distilled and Debunked in Plain English. Emmanuel Maggiori. Wiley. 2026. Modern monetary theory (MMT) is a seductive econo [...]