Edward Conard

Top Ten New York Times Bestselling Author

  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “Unintended Consequences provides a provocative interpretation of the causes of the global financial crisis and the policies needed to return to rapid growth. Whether you agree or not, this analysis is well worth reading.” - Nouriel Roubini, New York University; Chairman, Roubini Global Economics
  • “Unintended Consequences is full of substance, it is one of the must-read books of the year, and once I finish it I will be giving it a second read through right away.” - Tyler Cowen, Professor, George Mason University
  • “Unintended Consequences represents the most cogent and persuasive analysis of the Financial Crisis to date.” - Andrei Shleifer, 1999 John Bates Clark Medal Winner
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Sunday, March 31, 2019

AI Summary. New York City full-service restaurants reported a 1.6% job loss, the first annual decline in two decades, which the article attributes to the $15/hr minimum wage. A New York City Hospitality Alliance survey found 76.5% of full-service restaurants cut employee hours and 36% eliminated jobs in response to higher labor costs.

Gregory Bresiger New York Post
Date Posted:
Is Database:
Database

NYC’s restaurant industry is experiencing contraction due to the $15/hr minimum wage law, with full-service restaurants reporting a 1.6% job loss, the first annual decline in two decades.

Is a higher minimum wage cutting restaurant jobs and hours?

Core argument: New York City full-service restaurants reported a 1.6% job loss, the first annual decline in two decades, which the article attributes to the $15-per-hour minimum wage law.

NYC's restaurant industry is experiencing contraction due to the $15/hr minimum wage law, with full-service restaurants reporting a 1.6% job loss, the first annual decline in two decades. According to a survey by the NYC Hospitality Alliance, 76.5% of full-service restaurants reduced employee hours, and 36% eliminated jobs in 2018. Additionally, 75% of limited-service restaurants plan to cut hours, and 53% will eliminate jobs in 2019. These adjustments are responses to increased labor costs, prompting many establishments to raise prices. Despite these challenges, state officials argue that higher wages boost local economic activity by increasing consumer spending. However, the Hospitality Alliance warns that the industry, once a significant economic driver, is now stagnant, impacting hundreds of thousands of jobs and billions in economic output.

Takeaways by Macro Roundup® AI

  1. New York City full-service restaurants reported a 1.6% job loss, the first annual decline in two decades, which the article attributes to the $15-per-hour minimum wage law.
  2. In a NYC Hospitality Alliance survey, 76.5% of full-service restaurants reduced employee hours and 36% eliminated jobs in 2018, while 75% of limited-service restaurants planned to cut hours and 53% to eliminate jobs in 2019.
  3. State officials argue higher wages boost local economic activity through increased consumer spending, while the NYC Hospitality Alliance warns the restaurant industry is now stagnant, affecting hundreds of thousands of jobs and billions in economic output.

“…A once-growing industry is contracting, according to an online survey conducted by the New York City Hospitality Alliance, an association representing restaurants in the city. Last year, “full-service restaurants recorded a 1.6 percent job loss, which is the first recorded annual loss in two decades,” said Andrew Rigie, executive director of the trade group.The survey also said about a third of respondents will eliminate jobs and most will raise prices this year because of the new $15-an-hour law backed by Gov. Andrew Cuomo and other state officials, which took effect on Dec. 31, 2018.A total of 76.5 percent of full-service restaurant respondents reduced employee hours, and 36 percent eliminated jobs in 2018, the survey said.Also, 75 percent of limited-service restaurant respondents reported that they will reduce employee hours, and 53 percent will eliminate jobs in 2019 as a result of the wage increases, according to the survey.…”Gregory Bresiger, “The new minimum wage is killing NYC’s once-thriving restaurant scene,” New York Post, March 30, 2019, https://nypost.com/2019/03/30/the-new-minimum-wage-is-killing-nycs-once-thriving-restaurant-scene/The new minimum wage is killing NYC’s once-thriving restaurant scene New York City restaurants are eliminating jobs, reducing employee hours and raising prices due to the higher costs of the $15-per-hour minimum wage. A once-growing industry is contracting, according to an online survey conducted by the New York City Hospitality Alliance, an association representing restaurants in the city. Last year, “full-service restaurants recorded a 1.6 percent job loss, which is the first recorded annual loss in two decades,” said Andrew Rigie, executive director of the trade group. The survey also said about a third of respondents will eliminate jobs and most will raise prices this year because of the new $15-an-hour law backed by Gov. Andrew Cuomo and other state officials, which took effect on Dec. 31, 2018. A total of 76.5 percent of full-service restaurant respondents reduced employee hours, and 36 percent eliminated jobs in 2018, the survey said. Also, 75 percent of limited-service restaurant respondents reported that they will reduce employee hours, and 53 percent will eliminate jobs in 2019 as a result of the wage increases, according to the survey. The governor, through a spokeswoman, defended state policies: “All New Yorkers deserve to make a living wage and under the governor’s leadership, more minimum-wage workers than ever before have received an increase in their wages. The fact is that increasing the minimum wage puts more money in the pockets of hardworking New Yorkers, which creates more demand for local businesses and increases economic activity.” A spokeswoman for Mayor Bill de Blasio didn’t respond with a comment. The Hospitality Alliance said, “The results of this survey, and other industry trends, signal that a once-growing industry responsible for hundreds of thousands of jobs and billions of dollars in economic impact has become stagnant.”

Monday, April 1, 2019

AI Summary. An international assessment of adult skills found large gaps in numeracy proficiency among U.S. adults aged 16–65: 18% of White adults scored at the top levels versus 5% of Black adults and 6% of Hispanic adults, while 47% of Black adults and 52% of Hispanic adults scored at the lowest levels compared with 28% of White adults.

OECD Staff OECD
Date Posted:
Is Database:
Database

White adults had the highest numeracy proficiency, with 18% scoring at the top levels, while only 5% of Black adults & 6% of Hispanic adults reached similar levels.

How large are racial gaps in U.S. adult numeracy proficiency?

Core argument: In the 2012 PIAAC assessment, 18% of White U.S. adults aged 16–65 scored at the top numeracy proficiency levels, versus 5% of Black adults and 6% of Hispanic adults.

The 2012 PIAAC [Program for the International Assessment of Adult Competencies] data reveals significant disparities in numeracy proficiency among U.S. adults aged 16 to 65 across different racial/ethnic groups. White adults had the highest proficiency, with 18% scoring at the top levels, while only 5% of Black adults and 6% of Hispanic adults reached similar levels. Conversely, 47% of Black adults and 52% of Hispanic adults scored at the lowest proficiency levels, compared to 28% of White adults. These disparities highlight critical challenges in workforce readiness and economic participation, underscoring the need for targeted educational policies to bridge these gaps and enhance overall economic productivity.

Takeaways by Macro Roundup® AI

  1. In the 2012 PIAAC assessment, 18% of White U.S. adults aged 16–65 scored at the top numeracy proficiency levels, versus 5% of Black adults and 6% of Hispanic adults.
  2. At the lowest numeracy proficiency levels, the 2012 PIAAC data show 47% of Black adults and 52% of Hispanic adults, compared with 28% of White adults.

Ed, they do carve out numeracy score by race, see Figure 7-B (FYI, their new data will be released in September)
OECD Staff, "Literacy, Numeracy, and Problem Solving in Technology-Rich Environments Among U.S. Adults: Results from the Program for the International Assessment of Adult Competencies 2012," Organisation for Economic Co-operation and Development, Accessed April 1, 2019, https://nces.ed.gov/pubs2014/2014008.pdf

AI Summary. A National Bureau of Economic Research model estimates that national market concentration has risen while local labor market concentration has fallen, with the local decline contributing a 2.89 percentage point increase in labor's share of income from 1976 to 2014. The authors estimate welfare losses from labor market power of 2.9%–8.0% of lifetime consumption.

David Berger, Kyle Herkenhoff and Simon Mongey National Bureau of Economic Research
Date Posted:
Is Database:
Database

National market concentration has increased, but local labor market concentration has decreased over the past 35 years, according to a new @nberpub model. This decline has contributed to a 2.89 percentage point increase in labor’s share of income from 1976 to 2014.

Has rising employer market power reduced labor's share of income?

Core argument: An NBER model estimates that declining local labor market concentration raised labor's share of income by 2.89 percentage points from 1976 to 2014, countering the view that labor market power drove the labor share's decline.

A new NBER model reveals that while national market concentration has increased, local labor market concentration has decreased over the past 35 years. This decline in local concentration has contributed to a 2.89 percentage point increase in labor's share of income from 1976 to 2014, countering the notion that labor market power is responsible for the declining labor share. Despite substantial welfare losses from labor market power, ranging from 2.9% to 8.0% of lifetime consumption, the model suggests that labor market power has not driven the decline in labor share. Additionally, a national minimum wage could offer limited welfare gains by reallocating workers to larger, more productive firms. This data-driven insight highlights the complex dynamics of labor market power and its implications for economic policy.

Takeaways by Macro Roundup® AI

  1. An NBER model estimates that declining local labor market concentration raised labor's share of income by 2.89 percentage points from 1976 to 2014, countering the view that labor market power drove the labor share's decline.
  2. National market concentration rose over the past 35 years while local labor market concentration fell, according to the NBER model.
  3. The NBER model puts welfare losses from labor market power at 2.9% to 8.0% of lifetime consumption and suggests a national minimum wage could deliver limited welfare gains by reallocating workers to larger, more productive firms.

New NBER model on monopsony power, counterintuitively suggesting it's real but is actually declining not increasing.

"...In this paper, we develop a tractable, quantitative, general equilibrium model of oligopsony in the labor market that captures precisely this notion of labor market power. The model guides measurement by delivering a structurally consistent notion of labor market power that is both intuitive and easily measurable. We implement our approach using U.S. Census micro data and use our estimated model to explore the implications of labor market power for welfare and trends in the aggregate labor share. We have three main results. First, the model implies substantial welfare losses from labor market power, ranging from 2.9 to 8.0 percent of lifetime consumption. Second, despite these large losses, we find that labor market power has not contributed to the declining labor share because, despite an overall increase in national concentration, we find that the model consistent measure of local labor market concentration has declined over the last 35 years. Third, we revisit a classic question in labor economics: can a national minimum wage mitigate the effects of labor market power? We find that a national minimum wage delivers positive, but limited welfare gains, largely by reallocating workers from smaller to larger, more productive firms....Our theory implies that this declining labor market concentration increase labor’s share of income by 2.89 percentage points between 1976 and 2014, suggesting that labor market concentration is not the reason for a declining labor share...."

David Berger, Kyle Herkenhoff and Simon Mongey, " Labor Market Power," National Bureau of Economic Research, March 2019, https://www.nber.org/papers/w25719

AI Summary. Labor force participation among U.S. women aged 25–54 has surpassed its pre-Great Recession level, recovering 70% of its decline from the 2000 peak to the 2015 trough. Participation among men in the same age group has regained only 31% of its decline and remains below its 2007 level.

Stacy A. Anderson Brookings Institution
Date Posted:
Is Database:
Database

Women staging a labor force comeback. LFP For Prime Age Women Now Higher Than Prior To Great Recession, Men Still < 2007 Levels.

Are prime-age women recovering labor force participation faster than men?

Core argument: Prime-age women's U.S. labor force participation has recovered 70% of its decline from January 2000 to September 2015 and now exceeds pre-Great Recession levels.

Since 2015, the U.S. labor market has seen significant changes, with prime-age women's Labor Force Participation [LFP] now surpassing pre-Great Recession levels. This demographic has recovered 70% of its decline from January 2000 to September 2015, indicating a robust comeback. In contrast, prime-age men's LFP has only regained 31% of its previous decline and remains below 2007 levels. These trends highlight a gender disparity in labor market recovery, suggesting that economic policies and labor market dynamics have differently impacted men and women. The data underscores the importance of understanding gender-specific factors in labor force trends and their implications for economic growth and policy-making.

Takeaways by Macro Roundup® AI

  1. Prime-age women's U.S. labor force participation has recovered 70% of its decline from January 2000 to September 2015 and now exceeds pre-Great Recession levels.
  2. Prime-age men's labor force participation has regained only 31% of its earlier decline and remains below its 2007 level, trailing the recovery among prime-age women.

"...But much like 2000 is now recognized as a pivotal year for the U.S. labor market, 2015 is beginning to look like another turning point. In part due to the ongoing strengthening of the labor market, both prime-age women’s labor force participation and prime-age men’s participation have increased sharply from 2015 through the beginning of 2019. Figure 1 shows that prime-age women now participate at higher levels than prior to the Great Recession and have now made up 70 percent of their January 2000-September 2015 decline, while prime-age men have only made up 31 percent over the same period and are still below 2007 levels...."

Stacy A. Anderson, Lauren Bauer, Ryan Nunn, and Jay Shambaugh, "Women staging a labor force comeback,"Brookings Institution, March 26, 2019, https://www.brookings.edu/blog/up-front/2019/03/26/women-staging-a-labor-force-comeback/