Edward Conard

Top Ten New York Times Bestselling Author

  • “…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
  • “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
  • “…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
  • “Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “A full-throated defense of economic dynamism.” - The Wall Street Journal
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Wednesday, April 24, 2024

AI Summary. The authors estimate that Idaho's return-to-work bonus program, which paid up to $1,500 to people leaving nonemployment, raised employment among prime-age workers by 3.2 percentage points and the flow of unemployed workers into jobs by 18.2 percentage points. State-level estimates associate the program with a 2.9-point higher employment-population ratio and a 0.4-point lower unemployment rate.

Michael Strain and Duncan Hobbs IZA Institute of Labor Economics
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Idaho’s Return to Work Bonus of up to $1,500 was associated with a 0.4pp decrease in the unemployment rate and a 2.4% increase in nonfarm payroll employment. @MichaelRStrain

Do cash bonuses for returning to work raise employment?

Core argument: The authors' most controlled difference-in-differences models estimate that Idaho's Return to Work Bonus program, which paid up to $1,500 to leave nonemployment, raised prime-age employment by 3.2pp.

We estimate the effects of the Idaho RWB program, which gave recipients up to $1,500 to leave nonemployment, on a variety of labor market outcomes. Among prime-age workers, our most controlled DD models suggest that the Idaho RWB program increased employment by 3.2pp, increased the flow of unemployed workers into employment by 18.2pp, and increased the flow of nonparticipants into employment by 4.2pp. Using state-level outcomes with a similar specification, we estimate that the Idaho RWB program is associated with the employment-population ratio increasing by 2.9pp, the unemployment rate decreasing by 0.4pp, the nonparticipation rate decreasing by 2.5pp, and nonfarm payroll employment increasing by 2.4%. We find the estimated actual effects for Idaho are significantly larger than the placebo effects for states that did not enact the program.

Takeaways by Macro Roundup® AI

  1. The authors' most controlled difference-in-differences models estimate that Idaho's Return to Work Bonus program, which paid up to $1,500 to leave nonemployment, raised prime-age employment by 3.2pp.
  2. The Idaho Return to Work Bonus program is estimated to have increased the flow of unemployed workers into employment by 18.2pp and the flow of nonparticipants into employment by 4.2pp among prime-age workers.
  3. Using state-level outcomes, the authors estimate the Idaho program is associated with the employment-population ratio rising 2.9pp, the unemployment rate falling 0.4pp, nonparticipation falling 2.5pp, and nonfarm payroll employment rising 2.4%.

Related Articles:

  • Post-Pandemic Recovery for America’s Prime Age Labor Force: A Tale of Two Sexes — Prime-age women's labor force participation climbed about 5 points above its pre-pandemic level over a decade, while prime-age men's rose barely a point, only just regaining pre-pandemic levels. Despite economic expansion and labor shortages, work rates for prime-age American men are barely as high as at the trough of the severe Reagan-era recession.
  • Why Is Prime-Age Labor Force Participation So High? — Labor force participation among 25-to-54-year-olds rose after the pandemic shock, with women's rate exceeding its pre-pandemic peak while men's returned to its pre-pandemic level but stayed below its historical high. The authors find this participation rise can ease wage and price pressures in hot labor markets, but appears to have ended.
  • Men’s Falling Labor Force Participation Across Generations — Each successive generation of prime-age men has shown higher rates of not participating in the labor force, with millennials starting at a higher level and declining more steeply into their mid-30s, a pattern driven by school enrollment. Given rising educational attainment, the authors suggest the sustained rise in male nonparticipation may slow, which could benefit economic growth.

AI Summary. Valuation multiples have become less able to capture a business's underlying economics as corporate investment has shifted from tangible assets like factories to intangible assets and how those are recorded in financial statements. Adjusting Microsoft's reported $72.4bn net income for intangible investment raises it 14.7% to $83bn and cuts its price-to-earnings ratio from 34.9 to 30.5.

Michael Mauboussin and Dan Callahan Morgan Stanley
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.@mjmauboussin and Dan Callahan argue that the ability of P/E and EV/EBITDA multiples to capture the underlying economics of a business has degraded as intangible investments in R&D and customer acquisition have become increasingly important.

Has the shift to intangible investment degraded valuation multiples?

Core argument: Adjusting Microsoft's fiscal 2023 results for intangible investment raises net income from $72.4B as reported to $83B (14.7 percent higher) and EBITDA from $102.4B to $147.0B (43.6 percent higher).

The ability of multiples to capture the underlying economics of a business has degraded over time. This is mainly the result of a shift in how companies invest. In prior generations, businesses invested primarily in tangible assets such as factories and machines. Today, the majority of investments are in intangible assets. Multiples are supposed to reflect the magnitude and return on investment. But the shift to intangible investments, and how companies record them in financial statements, has wreaked havoc on that ability. To illustrate this point, we take two looks at the financial results of Microsoft, a multinational technology company that invests heavily in intangible assets. For fiscal 2023, Microsoft reported net income of $72.4B. Adjusted for intangible investment, the figure would be $83B, or 14.7 percent higher. The company’s EBITDA was $102.4B before the adjustment and $147.0B, 43.6 percent more, after the adjustment. Based on figures from June 30, 2023, the end of the company’s fiscal year, the trailing P/E went from 34.9 as reported to 30.5 as adjusted, and EV/EBITDA went from 24.2 to 16.9. These are material differences.

Takeaways by Macro Roundup® AI

  1. Adjusting Microsoft's fiscal 2023 results for intangible investment raises net income from $72.4B as reported to $83B (14.7 percent higher) and EBITDA from $102.4B to $147.0B (43.6 percent higher).
  2. Based on figures from June 30, 2023, Microsoft's trailing P/E falls from 34.9 as reported to 30.5 as adjusted for intangible investment, and EV/EBITDA falls from 24.2 to 16.9.
  3. Valuation multiples have degraded in their ability to capture a business's underlying economics, mainly because companies now invest largely in intangible assets rather than factories and machines, and because of how those investments are recorded in financial statements.

Related Articles:

  • Equity Risk Premiums: Determinants, Estimation, and Implications — The implied equity risk premium for the S&P 500 — the forward-looking extra return investors demand for holding stocks over risk-free assets — has fallen to 4.23%, its lowest level since 2008, as the market has climbed.
  • Long-Term Shareholder Returns: Evidence From 64,000 Global Stocks — A study of about 64,000 global stocks estimates net global stock market wealth creation of $75.7tn, with returns highly concentrated: the top 159 firms (0.25%) account for half of net wealth creation and the top 1,526 (2.39%) account for all of it. Fewer than half of stocks beat one-month US Treasury bills, 42.6% of non-US and 44.8% of US stocks.
  • Data Update 4 for 2024: Risk Enters the Equation — Across a universe of 47,698 companies, the median cost of capital for a US company is estimated at 7.9%, down from 9.6% a year earlier entirely because of declines in the price of risk, namely equity risk premiums and default spreads, though still above a historic low of 5.8%.

AI Summary. Corporate taxes are ultimately borne by people: companies attempt to pass increases to consumers through higher prices, and most economic studies conclude that 50%–70% of the remainder falls on workers and 30%–50% on investors. According to Tax Notes, 72% of domestically held stock value sits in retirement, charitable, and insurance accounts.

Phil Gramm and Mike Solon Wall Street Journal
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Phil Gramm and Mike Solon defend the TCJA corporate tax cuts by highlighting that customers, employees, and investors ultimately pay corporate taxes.

Phil Gramm and Mike Solon defend the TCJA corporate tax cuts by highlighting that customers, employees, and investors...

Who actually bears the cost of corporate taxes?

Core argument: Most economic studies conclude that 50–70% of a corporate tax increase not passed on to consumers in higher prices is borne by workers, with 30–50% borne by investors.

Corporate tax rates, which were the driving force behind the permanent part of the 2017 tax cuts, receive less attention than individual income-tax rates only because Americans don’t understand that corporations don’t pay taxes. A corporate entity is a “pass through” legal structure—a piece of paper in a Delaware filing cabinet. When the corporate tax rate increases, corporations try to pass the cost on to consumers. To the degree that the entire cost of the tax increase can’t be passed on to consumers, those costs are borne by employees and investors. Most economic studies conclude that 50% to 70% of a corporate tax increase not passed on in higher prices is borne by workers, while 30% to 50% is borne by investors. Who owns American corporations? According to Tax Notes, 72% of the value of all domestically held stocks is owned by pension plans, 401(k)s, individual retirement accounts and charitable organizations, or held by life insurance companies to fund annuities and death benefits.

Takeaways by Macro Roundup® AI

  1. Most economic studies conclude that 50–70% of a corporate tax increase not passed on to consumers in higher prices is borne by workers, with 30–50% borne by investors.
  2. According to Tax Notes, 72% of the value of all domestically held stocks is owned by pension plans, 401(k)s, individual retirement accounts and charitable organizations, or held by life insurers to fund annuities and death benefits.
  3. Corporate tax rates drove the permanent portion of the 2017 tax cuts yet receive less attention than individual income-tax rates, which the argument attributes to Americans not understanding that corporations pass tax costs to consumers, employees and investors.

Related Articles:

  • Tax Policy and Investment in a Global Economy — Using administrative tax data, the authors estimate that firms experiencing the mean corporate tax change under the 2017 US tax law increased investment by 20% relative to firms with no change, with long-run domestic and total capital up 7% and 13%. They find higher depreciation deductions largely offset added revenue from capital accumulation.
  • Who Gains from Corporate Tax Cuts? — The authors estimate that corporate tax cuts boost overall investment and employment, with goods-producing firms such as manufacturers raising capital expenditure and wage bills without changing dividends, and a 1% cut in the marginal tax rate lifting their capital spending by as much as 8%. Service-sector firms instead direct most of the windfall to dividends.
  • End of an Era: The Coming Long-Run Slowdown in Corporate Profit Growth and Stock Returns — The authors estimate that declining interest and corporate tax rates accounted for over 40% of real corporate profit growth from 1989 to 2019, while falling risk-free rates explain the entire expansion in price-to-earnings multiples. Real earnings before interest and taxes grew slightly more slowly than in 1962–1989, at 2.2% versus 2.4% per year.

AI Summary. The Census Bureau projects US population growth slowing to about 350k per year by the 2050s as the fertility rate sits below the 2.1 births per woman needed to keep population steady, reaching a record-low 1.64. Without immigration, the population would begin shrinking in 2038.

Aziz Sunderji Home Economics
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The Census Bureau forecasts annual US population growth of 350k in the 2050s, down from 3mm/year in the 1990s. After 2038, net population growth will be driven by immigration. @AzizSunderji

How much will US population growth slow as fertility falls?

Core argument: The Census Bureau forecasts U.S. population growth slowing to roughly 350,000 per year by the 2050s, not far off the level it fell to during the depths of the pandemic.

By the 2050s, the Census Bureau forecasts the population inching higher by a mere 350k per year—not far off where it fell to during the depths of the pandemic. It’s an odd situation, because the short term trend is totally different: an explosion in the population driven by migration. The official Census Bureau figure puts in-migration at around 1 million in 2023. But Goldman Sachs, for example, estimates it was far higher—at 2.5 million. The Congressional Budget Office (CBO) also believes immigration may have surged to record levels of 2-3 million per year in 2022-2023. They attribute much of this to “unauthorized migration”. If they’re right, then 2023 was the biggest population boom in the country’s history. But this is a short term blip. Over the long run, the population is set to grow more slowly. This is because the fertility rate is plunging. On average, each woman needs to have 2.1 children to keep the population steady (it’s slightly higher than 2.0, to account for child mortality and other factors). But fertility fell below that level about 15 years ago, and we never looked back. In 2020, the ratio fell to 1.64, the lowest rate recorded since the government began tracking these statistics in the 1930s. In fact, if it weren’t for immigration, the American population would begin to shrink in 2038.

Takeaways by Macro Roundup® AI

  1. The Census Bureau forecasts U.S. population growth slowing to roughly 350,000 per year by the 2050s, not far off the level it fell to during the depths of the pandemic.
  2. The U.S. fertility rate fell to 1.64 in 2020, the lowest since the government began tracking the statistic in the 1930s, and has stayed below the 2.1 replacement level for about 15 years.
  3. The Census Bureau puts 2023 in-migration near 1 million, while Goldman Sachs estimates 2.5 million and the Congressional Budget Office believes immigration may have reached 2–3 million per year in 2022–2023, much of it unauthorized.

Related Articles:

  • America Is Uniquely Ill-Suited To Handle a Falling Population — U.S. population growth slowed to about 7.4% in the decade to 2020, the slowest since the Great Depression, as the fertility rate fell from above the 2.1 needed for a stable population to 1.67. Because local and regional authorities levy 48% of all U.S. taxes—versus 20% in France and 6% in Britain—shrinking local revenue forces service cuts or tax rises.
  • The Demographic Outlook: 2024 to 2054 — The Congressional Budget Office projects the US population will grow from 342mm in 2024 to 383mm in 2054, an average 0.4% a year — less than half the 0.9% pace of the prior five decades. Immigration accounts for about 70% of growth over the next decade and for all population growth beginning in 2040.
  • Immigration and the U.S. Economy Since the Pandemic: An Accounting Exercise — The US native-born labor force fell by about 1.2m over four years, a decline driven overwhelmingly by population aging, while foreign-born labor supply grew by about 3m, leaving the overall labor force up roughly 2m. Without immigration, the total US labor force would have shrunk.

AI Summary. A working paper by researchers at Harvard, Columbia, and the Federal Reserve finds that nearly 20% of Florida insurers rated financially stable by the rating agency Demotech became insolvent, with 99.7% of that agency's ratings in the sample at A or above. The researchers argue this signals Florida's insurance market is more precarious than already known.

Leslie Kaufman Bloomberg
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Florida’s state-backed home insurer is now the largest in the state, and the remaining insurers may be weaker than expected: nearly 20% of insurers rated financially stable by Demotech became insolvent from 2009-20.

Are home insurer financial stability ratings overstating insurers' actual strength?

Core argument: Nearly 20% of Florida insurers that Demotech rated as financially stable went insolvent during 2009–2022, according to a working paper by researchers at Harvard University, Columbia University, and the Federal Reserve.

Nearly 20% of the companies doing business in Florida that Demotech rated as financially stable went insolvent during the period 2009 to 2022, according to a working paper by researchers at Harvard University, Columbia University, and the Federal Reserve. In their data sample, 99.7% of the ratings issued by Demotech were an A or above. That’s a signal, the researchers said, that Florida’s insurance market may be full of weak players and is even more precarious than already known. Demotech’s president and co-founder Joseph Petrelli disputed that his agency’s ratings are inflated in any way, calling the paper a “hit job.” He said he was “as surprised as anyone” when those seven firms declared insolvency, and that the real problem with the state insurance market is consumer and contractor fraud.

Takeaways by Macro Roundup® AI

  1. Nearly 20% of Florida insurers that Demotech rated as financially stable went insolvent during 2009–2022, according to a working paper by researchers at Harvard University, Columbia University, and the Federal Reserve.
  2. Demotech issued ratings of A or above in 99.7% of cases in the researchers' data sample, which the researchers said signals Florida's insurance market may be full of weak players and more precarious than already known.
  3. Demotech president and co-founder Joseph Petrelli disputed that his agency's ratings are inflated, called the paper a "hit job," and said the real problem in Florida's insurance market is consumer and contractor fraud.

Related Articles:

  • A Hidden Crisis In US Housing — State-run "last resort" home insurance programs, which cover properties the private market won't, have more than doubled their market share since 2018, with liabilities passing $1tn; Florida's plan faces potential losses of $525bn and California's at least $290bn, six times its 2018 level. Of 36 such plans covering natural catastrophes, 21 do not explicitly detail how they would pay deficits.
  • In Southwest Florida, High Home Insurance Rates Are Driving Away Would-Be Buyers — Florida homeowners paid about $6,000 a year for insurance on average, roughly triple what they paid in 2019 and compared with about $1,700 for the average US homeowner. Insurers and state regulators attribute the increases to widespread lawsuits and fraud, and a Category 5 hurricane led some insurers to exit the state or limit new policies.
  • Rising Insurance Costs Start to Hit Home Sales — A survey of house builders found that 31% in Florida and 29% in Southern California said buyers' home insurance concerns were somewhat slowing sales, versus 9% nationally. Researchers estimate that pricing in flood risk would reduce U.S. residential property values by at least $121bn, including over $50bn of overvaluation in Florida flood zones.

AI Summary. The European Commission and local law enforcement raided the Warsaw and Rotterdam offices of Nuctech, a Chinese state-owned maker of baggage security scanners, citing indications the company may have received foreign subsidies that could distort the EU internal market. Some Western countries have banned Nuctech products on national security grounds.

Henry Foy, Joe Leahy and Andy Bounds Financial Times
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The EU raided a Chinese security equipment supplier that “may have received foreign subsidies that could distort the internal market.” The EU ran a trade deficit of over €400B with the PRC in 2022.

The EU raided a Chinese security equipment supplier that “may have received foreign subsidies that could distort the...

Is Europe escalating enforcement against subsidized Chinese security equipment suppliers?

Core argument: The European Commission and local law enforcement raided the Warsaw and Rotterdam offices of Nuctech, a Chinese state-owned maker of baggage security scanners, following indications the company may have received foreign subsidies that could distort the internal market.

Brussels has raided the offices of a Chinese security equipment supplier. The raid by the European Commission and local law enforcement on the offices of Nuctech, which manufactures baggage security scanners, came as Brussels cracks down on what it sees as Beijing’s unfair trading practices. The raids took place at the Warsaw and Rotterdam offices of Nuctech, a state-owned company once run by the son of former Chinese president Hu Jintao. The company’s products have been banned by some western countries on national security grounds. In a statement, the commission said the raids followed “indications that the inspected company may have received foreign subsidies that could distort the internal market”. The EU on Wednesday said it had also opened an investigation into China’s medical device market on the grounds that European manufacturers were being unfairly blocked from supplying doctors and hospitals.

Takeaways by Macro Roundup® AI

  1. The European Commission and local law enforcement raided the Warsaw and Rotterdam offices of Nuctech, a Chinese state-owned maker of baggage security scanners, following indications the company may have received foreign subsidies that could distort the internal market.
  2. Nuctech, once run by the son of former Chinese president Hu Jintao, has had its products banned by some Western countries on national security grounds.
  3. The EU opened an investigation into China's medical device market on the grounds that European manufacturers were being unfairly blocked from supplying doctors and hospitals.

Related Articles:

  • EU to Press China On Industrial Overcapacity at Beijing Summit — European Union leaders are pressing China over its expansion of industrial capacity, particularly in renewable energy products, at a time of weak Chinese domestic demand and tightening access to markets such as the US, leaving Europe a target for excess exports. EU officials say the bloc's trade deficit with China is just below $400bn and has doubled within two years.
  • Mexico Targets Chinese Steel Imports With Increased Tariff Of Nearly 80% — Mexico imposed a tariff of nearly 80% on some steel imports, including certain Vietnamese exports of cold-rolled steel sheets, after local producers said Chinese steelmakers had strangled their production. Exporters that prove the steel originates outside China are exempt.
  • Brazil Launches China Anti-Dumping Probes After Imports Soar — Brazil's industry ministry has opened at least half a dozen investigations into alleged dumping of Chinese industrial products, spanning metal sheets, pre-painted steel, chemicals and tyres. Brazilian steelmakers have asked for tariffs of 9.6% to 25% on imported steel, as Brazil's steel and iron imports from China rose from $1.6bn to $2.7bn.

AI Summary. US law requires TikTok's Chinese owner ByteDance to divest the video-sharing app within 270 days or face a US prohibition. TikTok and ByteDance argue the measure infringes the free-speech rights of the app's 170m monthly US users and plan lawsuits to void the law or delay its enforcement.

Alex Barinka Bloomberg
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President Biden signed into law a ban on TikTok in the US as of 1/19/25 unless ByteDance, the Chinese parent, divests TikTok in favor of Western ownership. The company plans to challenge the law in court on First Amendment grounds.

Will a forced sale of a Chinese-owned app survive legal challenge?

Core argument: Biden signed legislation requiring ByteDance to divest TikTok within 270 days or face a US prohibition of the platform, setting a divestiture deadline of Jan. 19, a day before the next presidential inauguration.

Legislation requiring the social media app’s Chinese owners to divest sailed through Congress. Biden signed it into law Wednesday, beginning a 270-day countdown for a sale or a US prohibition of the popular video-sharing platform. TikTok and Beijing-based ByteDance have vowed to do all they can to stop the measure. They’ve argued it infringes the free-speech rights of the app’s 170 million monthly US users and plan to file suits to void the law or at least delay its enforcement. If TikTok can’t slow enforcement through the legal system, another chance of avoiding a separation may lie with a new administration. Biden’s signing the bill on Wednesday puts the divestiture deadline to Jan. 19 — a day before the next presidential inauguration. Biden’s opponent in the November election, Donald Trump, has recently come out against a TikTok ban. For Trump, that marked a reversal from his decision while president to ban the app via a 2020 executive order that was later voided by federal courts.

Takeaways by Macro Roundup® AI

  1. Biden signed legislation requiring ByteDance to divest TikTok within 270 days or face a US prohibition of the platform, setting a divestiture deadline of Jan. 19, a day before the next presidential inauguration.
  2. TikTok and Beijing-based ByteDance plan to file suits to void the law or delay its enforcement, arguing it infringes the free-speech rights of the app's 170 million monthly US users.
  3. Donald Trump has come out against a TikTok ban, reversing his decision as president to ban the app via a 2020 executive order that federal courts later voided.

Related Articles:

  • China Orders Apple to Remove Popular Messaging Apps — Chinese authorities ordered Apple to remove WhatsApp, Threads, Signal and Telegram from its App Store in China, citing national security concerns. The apps, which together have roughly 3bn users globally, were already accessible in China only through virtual private networks but remained commonly used.
  • TikTok Crackdown Shifts Into Overdrive, With Sale or Shutdown on Table — U.S. legislation that would ban TikTok or force its sale by Chinese parent ByteDance advanced out of the House Energy and Commerce Committee on a 50-0 vote. TikTok's campaign urging users to call their congressional representatives against the bill appeared to harden supporters' resolve.
  • Teens, Social Media and Technology 2023 — About nine-in-ten U.S. teens ages 13 to 17 say they use YouTube, making it the most widely used platform in Pew Research Center's survey, followed by TikTok (63%), Snapchat (60%), and Instagram (59%). Facebook use among teens fell from 71% in 2014-2015 to 33%, and Twitter's teen user base also shrank over the past decade.

Thursday, April 25, 2024

AI Summary. Living in an area with more college graduates is associated with lower mortality even after accounting for individuals' own education, and more than half of that correlation can be explained by area differences in smoking and obesity rates. The authors find evidence for both regulatory policies such as workplace smoking bans and peer effects about the harms of smoking.

Jacob Bor, David Cutler, Edward Glaeser and Ljubica Ristovska National Bureau of Economic Research
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Bor, @Cutler_econ, Glaeser, and @lj_ristovska find a strong negative correlation between the % of college graduates in an area and all-cause mortality, even after controlling for individual education.

Does living around college graduates lengthen life?

Core argument: The authors find a strong, robust relationship between area human capital and mortality that persists after controlling for individual education, with more than half the correlation explained by differences in smoking and obesity rates across areas.

[There is] a strong and robust relationship between area human capital and mortality, even after controlling for individual education. More than half of the correlation between area human capital and mortality can be explained by differences in smoking rates and obesity rates across areas, and that [these effects are] strong even after controlling for individual education. More than half of the correlation between area human capital and mortality can be explained by differences in smoking rates and obesity rates across areas. We find empirical evidence for [both] regulatory policies such as workplace smoking bans, and peer effects about the harms of smoking. Health-related behaviors are particularly sensitive to human capital spillovers among younger individuals, implicating the role of changing social norms around smoking and obesity across generations in the widening geographic gaps in health between high and low human capital areas.

Takeaways by Macro Roundup® AI

  1. The authors find a strong, robust relationship between area human capital and mortality that persists after controlling for individual education, with more than half the correlation explained by differences in smoking and obesity rates across areas.
  2. The authors find empirical evidence for both regulatory policies, such as workplace smoking bans, and peer effects regarding the harms of smoking.
  3. Health-related behaviors are particularly sensitive to human capital spillovers among younger individuals, implicating changing social norms around smoking and obesity across generations in the widening geographic health gaps between high and low human capital areas.

Related Articles:

  • Comments On: “Accounting For the Widening Mortality Gap Between American Adults With and Without a BA” By Anne Case and Angus Deaton — Selection plausibly accounts for most or all of the widening mortality gap between US adults with and without a bachelor's degree: high school achievement measures have not risen since the early 1970s while the share earning degrees rose, and national youth survey data show non-graduates increasingly negatively selected on aptitude scores.
  • Accounting for the Widening Mortality Gap Between American Adults With and Without a BA — The mortality gap between American adults with and without a four-year college degree widened across three periods—falling mortality for both with larger gains for graduates, then diverging, then rising faster for the less educated during the pandemic—reaching an 8.5-year difference in adult life expectancy. Americans with a degree, treated as a separate country, would rank just below Japan.
  • How Disadvantage Became Deadly in America — The author calculates that the average age of death among the shortest-lived 10% of Americans is 36, versus 55 in the Netherlands and 57 in Sweden, after falling by about eight years over the past decade. Wealthy Americans live equally long regardless of local opioid use and gun violence, while poor Americans in those areas live far shorter lives.

AI Summary. Norway's sovereign wealth fund argues that American companies are outpacing European rivals on innovation and technology because the US more readily accepts failure and risk and because Americans work harder and are more ambitious. US shares now make up almost half of the fund's equity holdings, up from 32% a decade earlier, while UK holdings fell from 15% to 6%.

Richard Milne and Robin Wigglesworth Financial Times
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The CEO of Norway’s $1.6T oil fund notes that US companies have outpaced their European rivals in innovation and technology; “There’s a mindset issue in terms of acceptance of mistakes and risks…the Americans just work harder.”

The CEO of Norway’s $1.6T oil fund notes that US companies have outpaced their European rivals in innovation and...

Why are American companies outpacing European rivals on innovation?

Core argument: US shares account for almost half of Norway's oil fund equities, up from 32% in 2013, while the UK, its leading European holding, fell from 15% of the equity portfolio a decade ago to 6% last year.

Nicolai Tangen noted it's “worrisome” that American companies were outpacing their European rivals on innovation and technology, leading to vast outperformance of US shares in the past decade. “There’s a mindset issue in terms of acceptance of mistakes and risks. You go bust in America, you get another chance. In Europe, you’re dead,” he said, adding that there was also a difference in “the general level of ambition. We are not very ambitious. I should be careful about talking about work-life balance, but the Americans just work harder.” Its US holdings have increased in the past decade while its European ones have declined. US shares account for almost half of all its equities compared with 32% in 2013. The leading European country — the UK — represented 15% of its equity portfolio a decade ago but just 6% last year. The fund is invested in about 9,000 companies worldwide, but seven US technology companies — Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla — account for about 12% of its equity portfolio.

Takeaways by Macro Roundup® AI

  1. US shares account for almost half of Norway's oil fund equities, up from 32% in 2013, while the UK, its leading European holding, fell from 15% of the equity portfolio a decade ago to 6% last year.
  2. Nicolai Tangen, head of Norway's oil fund, called it "worrisome" that American companies were outpacing European rivals on innovation and technology, which he linked to vast outperformance of US shares over the past decade.
  3. Tangen attributed the gap to a mindset difference on risk and mistakes — "You go bust in America, you get another chance. In Europe, you're dead" — plus a lower European level of ambition and Americans working harder.

Related Articles:

  • Comparing EU-to-US Output Per Hour — European Union output per hour worked has risen from about 72% of the US level in the early 2000s to about 82%. The EU's 28% shortfall in GDP per capita versus the US is roughly two-thirds attributable to lower output per hour and one-third to fewer hours worked; Germany's shortfall reflects fewer hours alone.
  • Europe Has Fallen Behind America and the Gap is Growing — The EU economy was somewhat larger than the US in 2008 ($16.2tn versus $14.7tn), but by 2022 the US had grown to $25tn while the EU and UK combined reached only $19.8tn. The dollar's status as the world's reserve currency allows the US to finance its ambitions without unsettling markets.
  • Europe Regulates Its Way to Last Place — Europe's regulators tend to act on the mere possibility of harm rather than evidence of it, an approach that can throttle innovation early. The McKinsey Global Institute found that among companies with over $1bn in revenue, U.S. firms spent 80% more on research and development, had 30% higher return on capital, and grew revenue 1.3 percentage points faster.

AI Summary. The U.S. total fertility rate fell 2% to 1.62 births per woman, the lowest since federal tracking began in the 1930s, with about 3.59mn births — the fewest since 1979 — according to provisional data. Birth rates for women aged 35-39, at 54.7 per 1,000, were close to the rate of 55.4 per 1,000 for women aged 20-24.

Jennifer Calfas and Anthony DeBarros Wall Street Journal
Date Posted:

3.59mm children were born in the US in 2023, down 2% from 2022, as the US total fertility rate fell to 1.6 births/woman, the lowest level on record.

How low has the U.S. fertility rate fallen?

Core argument: The U.S. total fertility rate fell 2% to 1.62 births per woman in 2023, the lowest since the government began tracking it in the 1930s, according to provisional data.

The total fertility rate fell to 1.62 births per woman in 2023, a 2% decline from a year earlier. It is the lowest rate recorded since the government began tracking it in the 1930s. Total fertility estimates the number of children a woman would give birth to in her lifetime. The number of births last year was the lowest since 1979, according to provisional data. About 3.59 million children were born in the U.S. in 2023, a 2% drop compared with 3.66 million in 2022. Women in their mid-to-late 30s are having children at similar rates to those in their early to mid-20s. Birthrates for women 35-39 fell to 54.7 births per 1,000 women—closer to the rates for women 20-24, which dropped 4% to 55.4 births per 1,000 women in 2023 The figures are provisional and likely to adjust slightly when final data are released later this year.

Takeaways by Macro Roundup® AI

  1. The U.S. total fertility rate fell 2% to 1.62 births per woman in 2023, the lowest since the government began tracking it in the 1930s, according to provisional data.
  2. About 3.59 million children were born in the U.S. in 2023, down 2% from 3.66 million in 2022 and the lowest number of births since 1979.
  3. Birthrates for women aged 35-39 fell to 54.7 births per 1,000 women in 2023, close to the 55.4 per 1,000 for women aged 20-24, which dropped 4%.

Related Articles:

  • America Is Uniquely Ill-Suited To Handle a Falling Population — U.S. population growth slowed to about 7.4% in the decade to 2020, the slowest since the Great Depression, as the fertility rate fell from above the 2.1 needed for a stable population to 1.67. Because local and regional authorities levy 48% of all U.S. taxes—versus 20% in France and 6% in Britain—shrinking local revenue forces service cuts or tax rises.
  • US Births Are Down Again, After the COVID Baby Bust and Rebound — US births declined steadily for years before the pandemic, with almost 600,000 fewer annual births in 2019 than in 2007, a 13% drop. The pandemic-related baby bust and subsequent rebound were short-term deviations from that longer trend, and 2022 birth counts remained below 2019 levels.
  • Without Immigrants, US Working-Age Population Would Shrink — All net US employment growth since early 2020 has been among foreign-born workers, and without immigration the US working-age population would be shrinking — a pattern likely to persist for the rest of the decade. The jump in immigration appears to be enabling a soft landing that most economists had thought impossible.

AI Summary. Researchers analyzing 22m patient appointments among 18- to 30-year-olds found a sharp jump in permanent contraceptive procedures among both men and women following the US Supreme Court decision ending the federal right to abortion. Monthly tubal ligations rose by 58 per 100,000 women with appointments, with the growth rate accelerating from 2.8 to more than 5 additional procedures per month.

Economist Staff The Economist
Date Posted:

According to a paper in the JAMA Health Forum, permanent contraceptive procedures have increased among both men and women in the aftermath of Dobbs.

Have young Americans increased permanent contraception after abortion rights ended?

Core argument: Tubal ligations among women aged 18–30 rose immediately after the Dobbs decision by 58 procedures per 100,000 women with health-care appointments per month, from a baseline of roughly 250, according to a study in JAMA Health Forum.

In a paper published on April 12th in JAMA Health Forum researchers from the University of Pittsburgh and Boston University analysed data on permanent contraceptive procedures among 18- to 30-year-olds. They looked at 22m instances of patients attending at least one appointment, for either evaluation or treatment, in each month between January 2019 and September 2023. These were mostly at academic medical centres, so government-funded public clinics providing free family-planning services to poor people may not have been adequately represented. The results are nonetheless striking. The study found a sharp jump in permanent contraceptive procedures among both men and women in the months after the Dobbs decision. Before Dobbs, there were around 250 tubal ligations for every 100,000 women with health-care appointments per month. But immediately afterwards that number jumped by 58. In the following months, the growth rate accelerated from its baseline of 2.8 additional procedures per month in the three-and-a-half years leading up to Dobbs to more than five.

Takeaways by Macro Roundup® AI

  1. Tubal ligations among women aged 18–30 rose immediately after the Dobbs decision by 58 procedures per 100,000 women with health-care appointments per month, from a baseline of roughly 250, according to a study in JAMA Health Forum.
  2. Researchers from the University of Pittsburgh and Boston University found the growth rate in tubal ligations accelerated from 2.8 additional procedures per month in the three-and-a-half years before Dobbs to more than five afterwards.
  3. The study analysed 22m instances of patients aged 18–30 attending at least one appointment in each month between January 2019 and September 2023, mostly at academic medical centres, so government-funded public family-planning clinics may not be adequately represented.

Related Articles:

  • Abortions Have Become 6% Rarer Since the End of Roe V Wade — A report from the non-profit Society of Family Planning estimates there were 31,180 fewer abortions than prior rates would suggest over a six-month period, a 6% decline, even as abortions administered by virtual clinics rose. Abortions fell 63% across the 22 states that enacted new restrictions and rose 12% in more permissive states.
  • America Is Uniquely Ill-Suited To Handle a Falling Population — U.S. population growth slowed to about 7.4% in the decade to 2020, the slowest since the Great Depression, as the fertility rate fell from above the 2.1 needed for a stable population to 1.67. Because local and regional authorities levy 48% of all U.S. taxes—versus 20% in France and 6% in Britain—shrinking local revenue forces service cuts or tax rises.
  • US Births Are Down Again, After the COVID Baby Bust and Rebound — US births declined steadily for years before the pandemic, with almost 600,000 fewer annual births in 2019 than in 2007, a 13% drop. The pandemic-related baby bust and subsequent rebound were short-term deviations from that longer trend, and 2022 birth counts remained below 2019 levels.

AI Summary. An outbreak of H5N1 avian influenza in U.S. dairy cattle has spread to at least 33 herds across eight states with one confirmed human case, and Texas's agriculture commissioner suspects it began earlier and may have infected up to 40% of Texas Panhandle herds. An H5N1 expert argues containment becomes unlikely once around 10 human cases are detected.

Zeynep Tufekci New York Times
Date Posted:

H5N1 has been detected in 33 dairy herds in eight states. @zeynep reports the Texas commissioner for agriculture “strongly suspected that the outbreak dated back to at least February.”

H5N1 has been detected in 33 dairy herds in eight states. @zeynep reports the Texas commissioner for agriculture “strongly...

Is the response to bird flu in dairy herds adequate?

Core argument: H5N1 avian influenza has spread to at least 33 dairy herds across eight states since the outbreak was first reported on March 25, with one confirmed human case so far.

The outbreak of H5N1 avian influenza among U.S. dairy cows, first reported on March 25, has now spread to at least 33 herds in eight states. So far there is only one confirmed human case. Rick Bright, an expert on the H5N1 virus who served on President Biden’s coronavirus advisory board, told me this is the crucial moment. “There’s a fine line between one person and 10 people with H5N1,” he said. “By the time we’ve detected 10, it’s probably too late” to contain. That’s when I told him what I’d heard from Sid Miller, the Texas commissioner for agriculture. He said he strongly suspected that the outbreak dated back to at least February. The commissioner speculated that back then, as much as 40% of the herds in the Texas Panhandle may have been infected.

Takeaways by Macro Roundup® AI

  1. H5N1 avian influenza has spread to at least 33 dairy herds across eight states since the outbreak was first reported on March 25, with one confirmed human case so far.
  2. Rick Bright, an H5N1 expert who served on President Biden's coronavirus advisory board, said there is "a fine line between one person and 10 people with H5N1," and that by the time 10 cases are detected containment is probably too late.
  3. Texas Agriculture Commissioner Sid Miller said he strongly suspected the outbreak dated back to at least February and speculated that as much as 40% of Texas Panhandle herds may have been infected then.

Related Articles:

  • Bird Flu Is Infecting More Mammals. What Does That Mean for Us? — The H5N1 bird flu strain now circulating globally has spread not only among farmed and wild birds but into many other animals, unlike earlier versions of the virus. Outbreaks in mink and in South American sea mammals suggest the virus most likely adapted to spread between mammals.
  • Bird Flu Outbreak in US Cows: Why Scientists Are Concerned — The H5N1 bird flu virus has been detected in cows from 16 herds across six US states, the first widespread outbreak in cattle after only sporadic prior infections with closely related flu viruses. One infected dairy worker is recovering, and the worker's viral variant carries a mutation linked to more efficient spread in mammals.
  • How the Current Bird Flu Strain Evolved to be so Deadly — A Nature study tracking bird flu genome changes and reported outbreaks found the virus spread three times faster among wild birds than farmed poultry, attributed to mutations letting it adapt to diverse species. Outbreaks, once seasonal with Northern Hemisphere bird migration, have become persistent, killing millions of birds across five continents.

AI Summary. According to States of Change data, 78% of Hispanic eligible voters nationwide are working class, rising to 82% in Arizona and 85% in Nevada. Polling shows the Democratic presidential candidate leading by 1 point among working-class Hispanics but by 39 points among college-educated Hispanics, a 38-point class gap larger than the 30-point gap among whites.

Ruy Teixeira The Liberal Patriot
Date Posted:

In the most recent New York Times/Siena poll, Biden’s margin over Trump among Hispanics is 9pp, down from 23pp in 2020. Ruy Teixeira @AEI notes that Biden leads by just 1pp among working-class Hispanics who make up 78% of Hispanic voters.

In the most recent New York Times/Siena poll, Biden’s margin over Trump among Hispanics is 9pp, down from 23pp in 2020. Ruy...

Is the class divide among Hispanic voters larger than among whites?

Core argument: States of Change data show 78% of Hispanic eligible voters nationwide are working class, rising to 82% in Arizona and 85% in Nevada.

The simple fact of the matter is that there are far, far more working-class than college-educated Hispanics. According to States of Change data, Hispanic eligible voters nationwide are 78% working class. And working-class levels among Latinos are even higher in critical states like Arizona (82%) and Nevada (85%). In terms of voting intentions, Biden leads by just one point among working-class Hispanics but by 39 points among their college-educated counterparts. Interesting, this 38-point reverse class gap is actually larger than the class gap in this poll among whites (30 points).

Takeaways by Macro Roundup® AI

  1. States of Change data show 78% of Hispanic eligible voters nationwide are working class, rising to 82% in Arizona and 85% in Nevada.
  2. Biden leads working-class Hispanics by one point but leads college-educated Hispanics by 39 points, a 38-point reverse class gap.
  3. The 38-point class gap among Hispanics in the poll exceeds the 30-point class gap among whites.

Related Articles:

  • American Politics Is Undergoing A Racial Realignment — National election surveys and Gallup polling show the Democratic Party's advantage among Black, Latino, and Asian voters at its lowest level since 1960. The article argues this shift reflects fading civil rights-era ties, a weakening link between income and party choice, and non-white voters with long-held conservative views aligning their votes with those views.
  • Consistent Signs of Erosion in Black and Hispanic Support for Biden — Polling shows the Democratic presidential candidate's support among nonwhite voters running well below his prior election standing across racial groups, with leads of 72-11 among Black voters, 47-35 among Hispanic registrants, and 40-39 among other nonwhite voters. About 5% of his former nonwhite voters now back the Republican candidate, including 8% of Hispanic voters.
  • Latinos Are Starting U.S. Businesses at a Torrid Pace — Immigrants accounted for 36% of new U.S. business launches last year, up from 25% in 2019, driven by a rise in Latino entrepreneurship, while business creation by white and native-born Americans has slowed. Hispanic-owned startups tend to be smaller, with 46% reporting over $100,000 in annual revenue versus 62% of white-owned firms.