“…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
“…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
“…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
“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
“…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
“Unintended Consequences is far smarter and more thought-provoking than most economics written for the general public” - Greg Mankiw, Harvard University, Former Chairman of the Council of Economic Advisors
“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
“There are an amazing number of good ideas and interesting points made in Unintended Consequences. The thinking underlying it, and the obvious depth of understanding of the author, are very impressive.” - Steven Levitt, coauthor of Freakonomics; 2004 John Bates Clark Medal
“Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
“…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology

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One Hundred Years in the U.S. Stock Markets

Hendrik Bessembinder Arizona State University

Date Posted:: March 19, 2026
Is Database:: Database
Is Important:: Important

Btw January 1926 and December 2025, 60% of US firms had negative total returns relative to T-bills. 46 firms accounted for half of the $91T in net wealth creation over the period, and 1,082 firms, 3.7%, accounted for 100% of net wealth creation.

Two central conclusions emerge from this study of long-term investment outcomes in the CRSP data. First, stocks publicly traded in the U.S. markets were, despite periodic volatility, a tremendous source of wealth enhancement, totaling some $91 trillion by my calculations over the 100-year period. Second, long-term stock market outcomes demonstrate strong positive skewness, and the success of the overall markets is attributable to a substantial extent to very strong outcomes for a relatively few firms. This skewness is of practical importance. Financial planning is often based on expected or mean future returns. The outcome of such an exercise is informative, but it should be recognized that in a skewed distribution most possible future outcomes are less than the expected or mean outcome. While the distribution of possible outcomes to diversified portfolios is less skewed than for individual stocks, positive skewness is present at long time horizons in any case. Analyses focused on the median outcome, or better yet on the entire distribution of potential outcomes, are more informative. The historical U.S. stock return data shows that both buy-and-hold returns and dollar based measures of shareholder wealth enhancement are dominated by relatively few high performing firms.

Takeaways by Macro Roundup^® AI

U.S. publicly traded stocks generated some $91 trillion in shareholder wealth enhancement over a 100-year period in the CRSP data, according to the author's calculations.
Long-term U.S. stock market outcomes display strong positive skewness, with overall market success attributable to a substantial extent to very strong outcomes for a relatively few firms.
Because most possible outcomes in a skewed distribution fall below the mean, the author argues that analyses focused on median outcomes or the entire distribution are more informative, noting positive skewness persists for diversified portfolios at long horizons.

Why Do Americans No Longer Work So Much More Than Non-Americans?

Serdar Birinci, Loukas Karabarbounis, and Kurt See National Bureau of Economic Research

Date Posted:: April 7, 2026
Is Database:: Database
Is Important:: Important

Work hours of Americans and Europeans were ~ equal in the early 1970s, but by the mid 1990s, Europeans worked much less than Americans. Half of this hours gap had vanished by 2019. The drop in US hours was collinear with an ~ doubling of Medicaid enrollment.

Whereas Americans and Europeans were working roughly the same hours in the early 1970s, by the mid 1990s, Americans were working much more than Europeans. We update Prescott’s observations on hours worked for advanced economies and document that about half of the hours gap in the 1990s has reversed by the end of the 2010s. While the decline in the U.S. hours is well documented in the literature, the increase in non-U.S. hours in the past two decades, both relative to the United States and in absolute levels, has not yet been analyzed systematically. The convergence in hours worked is concentrated on the extensive margin and is observed for both men and women. We offer a comparative study on the convergence of hours worked and ask, “Why do Americans no longer work so much more than non-Americans?” [Employing both nonstructural correlation analysis and a structural model of labor supply, we suggest that] U.S. hours per person declined after the 2000s because of the rise of benefits provided to the non-employed. Among these benefits, we find the most important role for health benefits and, in particular, Medicaid. For non-U.S. countries, the rise of labor supply is generally accounted for by a rise of wages and falling fixed costs and disutility of work.

Takeaways by Macro Roundup^® AI

About half of the U.S.–Europe gap in hours worked that opened by the 1990s had reversed by the end of the 2010s, with the convergence concentrated on the extensive margin and observed for both men and women.
The authors attribute the post-2000s decline in U.S. hours per person to the rise of benefits provided to the non-employed, assigning the most important role to health benefits and, in particular, Medicaid.
Rising labor supply outside the United States is generally accounted for by higher wages and falling fixed costs and disutility of work, according to the authors' correlation analysis and structural model of labor supply.

What’s Missing in the Fed’s Data about Ultrarich Portfolios

Owen Zidar and Eric Zwick The Everywhere Millionaire

Date Posted:: April 6, 2026
Is Database:: Database
Is Important:: Important

Zidar and Zwick find SCF data show ownership share in private businesses make up between 45–50% of top 0.1% American wealth, and ~80% of US households worth $30mm+ are business owners.

“Private businesses” make up a declining and now-modest share of top 0.1% wealth in the Federal Reserve’s Distribution of Financial Accounts (DFA), with corporate equities dominating portfolios at the very top. The misleading implication is that the rich are primarily stockholders. In fact, they are not. The issue, we learned, is that the DFA’s “private business” category is much narrower than what most people mean by the term. It covers only proprietor’s equity in noncorporate businesses — partnerships and sole proprietorships. Not S-corporations. Not other private corporations. Not financial partnerships like private equity or hedge funds. Just noncorporate, nonfinancial businesses. Private corporations are valued separately, but the Fed can’t distinguish households’ holdings of private corporate equity from their holdings of publicly traded stocks. They’re all lumped together into “corporate equities.” The Survey of Consumer Finances (SCF) tells a different story about what the top 0.1% actually owns. Private business shows up as roughly 45 to 50% of top wealth — far larger than the DFA’s “private business” label suggests. About 80% of households worth $30 million or more are business owners.

Takeaways by Macro Roundup^® AI

The Survey of Consumer Finances shows private business at roughly 45–50% of top 0.1% wealth, far more than the Federal Reserve's Distribution of Financial Accounts "private business" label implies.
The Distribution of Financial Accounts' "private business" category covers only proprietor's equity in noncorporate, nonfinancial partnerships and sole proprietorships, excluding S-corporations, other private corporations, and private equity and hedge fund partnerships.
The Federal Reserve cannot distinguish households' private corporate equity from publicly traded stocks, lumping both into "corporate equities," which makes the top 0.1% appear to be primarily stockholders.

The Net Present Value of the Billionaire Tax Act: An Assessment of the Fiscal Effects of California's Proposed Wealth Tax

Benjamin Jaros, Joshua Rauh, Greg Kearney, John Doran, et al. Stanford University

Date Posted:: March 9, 2026
Is Database:: Database

A simulation study of the proposed CA wealth tax on billionaires, finds a 71% chance that it will have a negative NPV, with a mean of −$24.7 billion. The PV of permanently lost income tax revenue more than offsets the one-time wealth tax collection.

The California Billionaire Tax Act of 2026 proposes a one-time 5% tax on the worldwide net worth of individuals exceeding $1 billion. This measure applies to tangible and intangible assets, including those held through trusts and certain recent transfers. Our proxy for these taxable assets in this dataset is the “Net Worth” of each California-based billionaire listed in the 2025 Forbes Billionaires listing. Our preferred revenue estimate implies that approximately 55% of the billionaire income tax base has or will avoid the tax, nearly double the 30.7% break-even threshold under even [proponent’s optimistic] assumption of six confirmed departures at a 1.5% real discount rate, and approaching the 61.4% threshold at 3%. The wealth tax has positive net present value only if the one-time revenue exceeds the present value of foregone income taxes from departing billionaires. We simulate draws from uniform distributions over the plausible ranges for discount rates, revenue from the wealth tax, and lost income tax collections; 71% of draws yield a negative net present value, with a mean of [-]$24.7 billion, with a median of −$19.1 billion, and standard deviation of $38.4 billion. [See Figure 3 in gallery]. These estimates are conservative in that we exclude all non-income-tax fiscal spillovers, including lost sales tax, property tax, and business activity, such as employing other income taxpayers.

Takeaways by Macro Roundup^® AI

Simulations drawing from plausible ranges for discount rates, wealth-tax revenue, and lost income tax collections yield a negative net present value for California's proposed Billionaire Tax Act in 71% of draws, with a mean of −$24.7 billion, a median of −$19.1 billion, and a standard deviation of $38.4 billion.
The authors' preferred revenue estimate implies roughly 55% of the billionaire income tax base has avoided or will avoid the proposed one-time 5% tax on worldwide net worth above $1 billion, nearly double the 30.7% break-even threshold at a 1.5% real discount rate and approaching the 61.4% threshold at 3%.
The authors describe their estimates as conservative because they exclude all non-income-tax fiscal spillovers, including lost sales tax, property tax, and business activity such as employing other income taxpayers.

The Limits of New York’s “Tax the Rich” Policy

E. J. McMahon Manhattan Institute

Date Posted:: March 9, 2026
Is Database:: Database

Btw 2010 and 2022, New York State’s share of realized capital gains among income millionaires declined 5.1pp to 8.9%, while Florida’s increased 8.7pp to 16.7% – above California’s 14.9%.

As the nation emerged from the Great Recession in 2010, the capital gains of income millionaires were disproportionately concentrated in the four most populous states: California, New York, Texas, and Florida. Between 2010 and 2022, taxpayers earning $1 million or more in these states accounted, on average, for 50% of the nation’s total capital gains realizations. At the start of the period, California led all states, with 16% of capital gains among all U.S. income millionaires. New York ranked second, at 14%, while Texas and Florida trailed at 8.7% and 8%, respectively. The next 12 years saw a significant shift in the rankings. By 2022, Florida had topped the list, with 16.7% of capital gains income among millionaire earners, followed by California at 14.9% and Texas at 9.7%. New York had dropped to fourth place, with 8.9%—essentially changing places with Florida.

Takeaways by Macro Roundup^® AI

New York's share of capital gains realized by U.S. income millionaires fell from 14% in 2010, second among states, to 8.9% in 2022, dropping it to fourth place.
Florida rose from 8% of millionaire capital gains realizations in 2010 to 16.7% in 2022, topping all states and essentially swapping places with New York.
California, New York, Texas, and Florida together accounted for an average of 50% of U.S. capital gains realizations by taxpayers earning $1 million or more between 2010 and 2022.

The Robin Hood State Is Coming For The Rich

Economist Staff The Economist

Date Posted:: February 19, 2026
Is Database:: Database
Is Important:: Important

Advanced economies have become increasingly redistributive. “While the share of US taxable income going to the top 1% of earners soared, their share of post-tax income has risen only slightly; the 1% paid 40% of income tax in 2022, up from 33% in 2001.”

The vigour of the Robin Hood state varies across countries. In America more redistribution has merely offset rising pre-tax inequality. According to the Congressional Budget Office, for example, 2022—the most recent year for which detailed data are available—was the fourth-most unequal year on record, as measured by the Gini coefficient of taxable income, behind only 2021, 2020 and 2012. But inequality after taxes and transfers was lower than in 2000, 2005-07, 2012, 2014, and 2017-18 and 2021. It was also only a shade higher than in 1986. Even as the share of America’s taxable income going to the top 1% of earners has soared, their share of post-tax income has risen only slightly. Today’s combination of higher pre-tax inequality and higher tax rates on top earners has left governments astonishingly dependent on the wealthiest for their revenue. In America, the 1% paid 40% of income tax in 2022, up from 33% in 2001.

Takeaways by Macro Roundup^® AI

America's top 1% of earners paid 40% of income tax in 2022, up from 33% in 2001, leaving governments dependent on the wealthiest for revenue as pre-tax inequality and top tax rates both rose.
According to the Congressional Budget Office, 2022 was the fourth-most unequal year on record by the Gini coefficient of taxable income, behind only 2021, 2020 and 2012.
American inequality after taxes and transfers was lower in 2022 than in 2000, 2005-07, 2012, 2014, 2017-18 and 2021, and only a shade higher than in 1986, as more redistribution offset rising pre-tax inequality.

Ed Conard Debates Furman On "The Expected Value of Risk Taking"

Edward Conard Macro Roundup

Date Posted:: September 22, 2025
Is Database:: Database
Is Important:: Important

I debate @JasonFurman—Pres. Obama’s Chair of the Council of Economic Advisors—at Harvard over the effect of tax increases on the expected value of innovative risk-taking and the magnitude of changes needed to equilibrate America’s fiscal policy.

I debate Jason Furman on changes needed to equilibrate America’s fiscal policy. I argue that spending increases slow growth, not tax increases needed to pay for them; that tax cuts are temporary; that, unlike Europe, which lacks investment-worthy ideas, tax increases will reduce the expected value of America’s innovative risk-taking; and that driving debt below 100% of GDP is critical with rising interest rates and CBO’s failure to assume periodic budget-busting recessions. Read more

Takeaways by Macro Roundup^® AI

In a debate with Jason Furman, Ed Conard argues that driving U.S. debt below 100% of GDP is critical given rising interest rates and CBO's failure to assume periodic budget-busting recessions.
Conard argues that spending increases, rather than the tax increases needed to pay for them, slow growth, and that tax cuts are temporary.
Conard argues that tax increases will reduce the expected value of America's innovative risk-taking, unlike in Europe, which he contends lacks investment-worthy ideas.

Btw January 1926 and December 2025, 60% of US firms had negative total returns relative to T-bills. 46 firms accounted for half of the $91T in net wealth creation over the period, and 1,082 firms, 3.7%, accounted for 100% of net wealth creation.

Do a few firms drive a century of stock market wealth?

Takeaways by Macro Roundup® AI

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Work hours of Americans and Europeans were ~ equal in the early 1970s, but by the mid 1990s, Europeans worked much less than Americans. Half of this hours gap had vanished by 2019. The drop in US hours was collinear with an ~ doubling of Medicaid enrollment.

Why has the gap in hours worked between Americans and others narrowed?

Takeaways by Macro Roundup® AI

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Zidar and Zwick find SCF data show ownership share in private businesses make up between 45–50% of top 0.1% American wealth, and ~80% of US households worth $30mm+ are business owners.

Does official wealth data overstate how much the ultrarich own public stocks?

Takeaways by Macro Roundup® AI

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A simulation study of the proposed CA wealth tax on billionaires, finds a 71% chance that it will have a negative NPV, with a mean of −$24.7 billion. The PV of permanently lost income tax revenue more than offsets the one-time wealth tax collection.

Does a one-time wealth tax on billionaires raise net revenue?

Takeaways by Macro Roundup® AI

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Btw 2010 and 2022, New York State’s share of realized capital gains among income millionaires declined 5.1pp to 8.9%, while Florida’s increased 8.7pp to 16.7% – above California’s 14.9%.

Are millionaire capital gains shifting from high-tax to low-tax states?

Takeaways by Macro Roundup® AI

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Advanced economies have become increasingly redistributive. “While the share of US taxable income going to the top 1% of earners soared, their share of post-tax income has risen only slightly; the 1% paid 40% of income tax in 2022, up from 33% in 2001.”

Has redistribution offset rising pre-tax inequality in America?

Takeaways by Macro Roundup® AI

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I debate @JasonFurman—Pres. Obama’s Chair of the Council of Economic Advisors—at Harvard over the effect of tax increases on the expected value of innovative risk-taking and the magnitude of changes needed to equilibrate America’s fiscal policy.

Do higher taxes reduce the expected value of innovative risk-taking?

Takeaways by Macro Roundup® AI

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