“…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
“A full-throated defense of economic dynamism.” - The Wall Street Journal
“…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
“Unintended Consequences represents the most cogent and persuasive analysis of the Financial Crisis to date.” - Andrei Shleifer, 1999 John Bates Clark Medal Winner
“…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
“…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
“…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
“Unintended Consequences should be read by anyone who takes for granted the superiority of progressive taxation and has not thought carefully about the trade-offs involved.” - The New Republic
“Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
“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
“…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management

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Which U.S. Stocks Generated the Highest Long-Term Returns?

Hendrik Bessembinder Arizona State University

Date Posted:: July 25, 2024
Is Database:: Database
Is Important:: Important

Hendrik Bessembinder finds that from 1925 to 2023 51.6% of equities had a negative return; however, 17 stocks had cumulative returns greater than $50,000 per dollar invested, led by Altria Group with a return of $2.65mm for each dollar invested.

This report describes compound return outcomes for the 29,078 publicly-listed common stocks contained in the CRSP database from December 1925 to December 2023. The majority (51.6%) of these stocks had negative cumulative returns. However, the investment performance of some stocks was remarkable. Seventeen stocks delivered cumulative returns greater than five million percent (or $50,000 per dollar initially invested), with the highest cumulative return of 265 million percent (or $2.65 million per dollar initially invested) accruing to long-term investors in Altria Group. Annualized compound returns to these top performers relatively were modest, averaging 13.47% across the top seventeen stocks, thereby affirming the importance of “time in the market.” The highest annualized compound return for any stock with at least 20 years of return data was 33.38%, earned by Nvidia shareholders.

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

American work hours declined after 2000 primarily because expanded health benefits reduced employment incentives for non-workers.
European and other developed nations increased work hours due to rising wages and lower barriers to employment participation.
The transatlantic work-hour gap that peaked in the 1990s has substantially reversed over the past two decades.

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 ultra-wealthy derive substantial wealth from private business ownership, not primarily from public stock holdings as commonly assumed.
Federal data limitations obscure the true composition of top earners’ portfolios by combining private and public corporate equity into one.
Accurate wealth distribution analysis requires distinguishing between private business stakes and public market investments to understand inequality drivers.

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.

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.

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.

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.

Hendrik Bessembinder finds that from 1925 to 2023 51.6% of equities had a negative return; however, 17 stocks had cumulative returns greater than $50,000 per dollar invested, led by Altria Group with a return of $2.65mm for each dollar invested.

Related Articles:

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.

Takeaways by Macro Roundup® AI

Related Articles:

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.

Takeaways by Macro Roundup® AI

Related Articles:

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.

Related Articles:

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.

Related Articles:

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%.

Related Articles:

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.”

Related Articles:

Takeaways by Macro Roundup^® AI

Takeaways by Macro Roundup^® AI