Edward Conard

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  • “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
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
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Beyond the Milky Way, a Galactic Wall

Dennis Overbye New York Times
Date Posted:
July 20, 2020
Is Database:
Database

The discovery of the South Pole Wall, a vast structure of thousands of galaxies, reveals complexities in cosmic expansion and gravitational dynamics. This wall influences the local universe’s expansion, pulling galaxies toward it at a speed of 30 miles per second faster than anticipated.

The discovery of the South Pole Wall, a massive structure of thousands of galaxies spanning 700m light-years, highlights the complexities of cosmic expansion and gravitational dynamics. This wall, obscured by the Milky Way's "zone of avoidance," affects the local universe's expansion by drawing galaxies towards it at 30 miles per second faster than expected. Such gravitational influences underscore the uneven distribution of matter, challenging the notion of a uniformly expanding universe. The South Pole Wall's gravitational pull, alongside other structures like the Great Attractor, contributes to our galaxy's motion through space at 400 miles per second. This discovery emphasizes the role of dark matter in shaping cosmic structures, impacting our understanding of the universe's macroeconomic framework.

Dennis Overbye, Beyond the Milky Way, a Galactic Wall,"New York Times, July 10, 2020, https://www.nytimes.com/2020/07/10/science/astronomy-galaxies-attractor-universe.html

Beyond the Milky Way, a Galactic Wall

Astronomers have discovered that there is a vast wall across the southern border of the local cosmos.

The South Pole Wall, as it is known, consists of thousands of galaxies — beehives of trillions of stars and dark worlds, as well as dust and gas — aligned in a curtain arcing across at least 700 million light-years of space. It winds behind the dust, gas and stars of our own galaxy, the Milky Way, from the constellation Perseus in the Northern Hemisphere to the constellation Apus in the far south. It is so massive that it perturbs the local expansion of the universe.

But don’t bother trying to see it. The entire conglomeration is behind the Milky Way, in what astronomers quaintly call the zone of avoidance.

An international team of astronomers led by Daniel Pomarède of Paris-Saclay University and R. Brent Tully of the University of Hawaii announced this new addition to the local universe on Friday in a paper in Astrophysical Journal. The paper is festooned with maps and diagrams of blobby and stringy features of our local universe as well as a video tour of the South Pole Wall.

It is the latest installment of an ongoing mission to determine where we are in the universe — to fix our neighborhood among the galaxies and the endless voids — and where we are going.

“The surprise for us is that this structure is as big as the Sloan Great Wall and twice as close, and remained unnoticed, being hidden in an obscured sector of the southern sky,” Dr. Pomarède said in an email.

“The discovery is a wonderful poster child for the power of visualizations in research,” Dr. Tully said.

The new wall joins a host of other cosmographic features: arrangements of galaxies, or a lack of them, that astronomers have come to know and love over the last few decades, with names like the Great Wall, the Sloan Great Wall, the Hercules-Corona Borealis Great Wall and the Bootes Void.

The new paper was based on measurements, performed by Dr. Tully and his colleagues, of the distances of 18,000 galaxies as far away as 600 million light-years. By comparison, the most distant objects we can see — quasars and galaxies that formed shortly after the Big Bang — are about 13 billion light years away.

Beyond the Milky Way, a Galactic Wall: Extended Excerpt Image 1


The galaxies in the wall cannot be seen, but Dr. Pomarède and his colleagues were able to observe their gravitational effects by assembling data from telescopes around the world.

In the expanding universe, as described in 1929 by the astronomer Edwin Hubble and confirmed for almost a century, distant galaxies are flying away from us as if they were dots on an inflating balloon; the farther they are, the faster they recede from us, according to a relation called the Hubble law.

That motion away from Earth causes their light to be shifted to longer, redder wavelengths and lower frequencies, like retreating ambulance sirens. Astronomers use this “redshift,” which is easily measured, as a proxy for relative distance in the universe. By measuring the galaxy distances independently, the “Cosmicflows” team, as Dr. Pomarède and his colleagues call themselves, was able to distinguish the motion caused by the cosmic expansion from motions caused by gravitational irregularities.

As a result, they found that the galaxies between Earth and the South Pole Wall are sailing away from us slightly faster than they otherwise should be, by about 30 miles per second, drawn outward by the enormous blob of matter in the wall. And galaxies beyond the wall are moving outward more slowly than they otherwise should be, reined in by the gravitational drag of the wall.

One astonishing aspect of the wall is how big it is compared to the volume that the team was surveying: a contiguous filament of light 1.4 billion light-years long, packed into a cloud maybe 600 million in radius. “There is hardly room in the volume for anything bigger!” Dr. Tully said in an email. “We’d have to anticipate that our view of the filament is clipped; that it extends beyond our survey horizon.”

And yet the South Pole Wall is nearby in cosmological terms. “One might wonder how such a large and not-so-distant structure remained unnoticed,” Dr. Pomarède mused in a statement issued by his university.

But in the expanding universe, there is always something more to see.

On the largest scales, cosmologists attest, the universe should be expanding smoothly, and the galaxies should be evenly distributed. But on smaller, more local scales, the universe appears lumpy and gnarled. Astronomers have found that galaxies are gathered, often by the thousands, in giant clouds called clusters and that these are connected to one another in lacy, luminous chains and filaments to form superclusters extending across billions of light-years. In between are vast deserts of darkness called voids.

From all of this has emerged what some astronomers call our “long address”: We live on Earth, which is in the solar system, which is in the Milky Way galaxy. The Milky Way is part of a small cluster of galaxies called the Local Group, which is on the edge of the Virgo cluster, a conglomeration of several thousand galaxies.

In 2014, Dr. Tully suggested that these features were all connected, as part of a giant conglomeration he called Laniakea — Hawaiian for “open skies” or “immense heaven.” It consists of 100,000 galaxies spread across 500 million light-years.

All this lumpiness has distorted the expansion of the universe. In 1986, a group of astronomers who called themselves the Seven Samurai announced that the galaxies in a huge swath of the sky in the direction of the constellation Centaurus were flying away much faster than the Hubble law predicted, as if being pulled toward something — something the astronomers called the Great Attractor. It was the beginning of something big.

“We now see the Great Attractor as the downtown region of the supercluster that we live in — an overall entity that our team has called the Laniakea Supercluster,” Dr. Tully said. All the different parts of this supercluster are tugging on us, he added.

As a result, the Great Attractor and its relatives are shedding light on another enduring cosmic mystery — namely, where we are headed.

Astronomers discovered in 1965 that space is suffused with microwave radiation, a bath of heat — with a temperature of 2.7 degrees Kelvin, or minus 455 degrees Fahrenheit — left over from the birth of the universe 14 billion years ago. Subsequent observations revealed that this bath is not uniform: It is slightly warmer in one direction, suggesting that we — Earth, our galaxy and the Local Group — are moving through the microwaves, like a goldfish in a fishbowl, at about 400 miles per second in the approximate direction of Centaurus, but aiming far beyond.

Beyond the Milky Way, a Galactic Wall: Extended Excerpt Image 2


Why? What is over there, on the other side of the fishbowl, compelling us? That is the kind of question that would come up in an Arthur C. Clarke novel, where humanity is always gearing up for some definitive expedition around the curve of the universe.

“A major goal in cosmology is to explain this motion,” Dr. Tully said in a series of emails. In theory, the motion arises from the lumpy distribution of matter that grew out of tiny ripples in the density of the early universe.

“The Great Attractor is certainly an important part of the cause of our motion,” Dr. Tully said. “The South Pole Wall also contributes but, again, only in part,” he added, listing more local galaxy clusters and voids. “Every hill and valley in the density distribution makes itself felt.”

Most of that is stuff that we cannot see directly. According to the prevailing theory of a confoundingly preposterous universe, the cosmos contains about five times as much invisible dark matter as luminous atomic matter.

Nobody knows exactly what dark matter is made of, but according to cosmologists it provides the gravitational scaffolding for the luminous structures in the universe — galaxies, galaxy clusters, superclusters, voids and chains like the South Pole Wall, all connected by spidery filaments in what’s known as the cosmic web. The visible universe of stars and galaxies, cosmologists like to say, is like snow on mountaintops or lights on dark, distant Christmas trees.

But by following the lights and how they are moving, astronomers like Dr. Tully and his cosmographers have now been able to probe the shadows on which they sit: galumphing clouds of mass whose gravity shapes the destiny of the visible cosmos, arranging it into shapes and neighborhoods, walls, valleys and voids.

“It’s just dark matter having its way,” Dr. Tully said.

“We are like swimmers attempting to swim upstream but being carried downstream faster.”

“…The South Pole Wall, as it is known, consists of thousands of galaxies — beehives of trillions of stars and dark worlds, as well as dust and gas — aligned in a curtain arcing across at least 700 million light-years of space. It winds behind the dust, gas and stars of our own galaxy, the Milky Way, from the constellation Perseus in the Northern Hemisphere to the constellation Apus in the far south. It is so massive that it perturbs the local expansion of the universe. But don’t bother trying to see it. The entire conglomeration is behind the Milky Way, in what astronomers quaintly call the zone of avoidance….”

Ed Comment:"(This article is interesting one it's own.) But I can't help but wonder if as we grow richer, we (can afford to) devote a greater share our constrained supply of intelligence to esoteric science that does little, if anything, to increase productivity. Perhaps that's a significant contributor to why productivity is slowing down. Perhaps a lot of money isn't devoted to studies like this,but the money that is devoted sucks down a significant share of brain power, brain power that's not very expensive because, unfortunately, it's not very productive."

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Previous articleJuly 17, 2020A Possible Declining Trend For Worldwide InnovationAccording to @JonathanHuebnerm, the rate of important innovation peaked in 1873 and has been declining since, driven by economic limits of technology or human constraints in information processing.Next articleJuly 20, 2020Global Imbalances And Policy Wars At The Zero Lower BoundCapital inflows can depress domestic demand by affecting exchange rates, leading to zero-sum beggar-thy-neighbor devaluations & currency wars at the Zero Lower Bound (ZLB).
Showing 485 database articles primarily about either Productivity, Cronyism, Incentives/Risk-Taking, Innovation/Research, Institutional Capabilities, Intangibles, Investment, Startups, or Workforce Reorganization

Moonshot Capitalism: AI Rewrites The Venture Capital Playbook

AI Summary. Deep-tech investment outside AI has exceeded $150bn since early 2024, surpassing the $133bn invested across the entire prior decade. Falling valuations for traditional software companies and outsized returns from early bets on capital-intensive ventures are pushing investors toward riskier, science-driven deals.

Tim Bradshaw Financial Times
Date Posted:
September 10, 2026
Is Database:
Database

Since the start of 2024, more than $150B of venture capital has been invested into non-AI “deep tech” firms whose products are rooted in significant engineering advances, exceeding the $133B invested in such firms btw 2010 and 2019.

Are investors abandoning software for capital-intensive science bets?

Core argument: Deep-tech investment excluding AI exceeded $150bn since early 2024, surpassing the entire $133bn deployed across the prior decade (through end-2019), as falling valuations for traditional software push venture capital toward capital-intensive scientific bets.

The AI boom is fuelling a resurgence in ambitious “moonshot” bets, as early SpaceX backers’ huge returns and falling valuations for traditional software companies force tech investors to embrace riskier and more capital-intensive dealmaking. Excluding the giant sums ploughed into AI start-ups, global investment in “deep tech” — companies whose products are rooted in big scientific or engineering advances — has exceeded $150bn since the start of 2024, more than the $133bn in the entire decade to the end of 2019, according to Dealroom. This year’s deep-tech investments have not yet surpassed 2021’s peak, which was propelled by battery and electric vehicle deals for the likes of Rivian and Northvolt — many of which turned sour, highlighting the risks involved in moonshot dealmaking.

Takeaways by Macro Roundup® AI

  1. Deep-tech investment excluding AI exceeded $150bn since early 2024, surpassing the entire $133bn deployed across the prior decade (through end-2019), as falling valuations for traditional software push venture capital toward capital-intensive scientific bets.
  2. The 2021 deep-tech peak — driven by battery and electric vehicle deals including Rivian and Northvolt — has not yet been surpassed, and the subsequent losses from those deals underscore the capital destruction risk inherent in moonshot dealmaking.

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  • Capital Is Making a Comeback — Btw 1985-2021 the capital intensity of the American economy was relatively flat as a rise in intangible investment was offset by a decline in tangible…
  • Public to Private Equity in the United States: A Long-Term Look — Global venture capital returns are highly skewed: 62% of deals lose money, more than half lose 50–100% of invested capital, but fat-tailed outliers drive overall returns. This pattern mirrors historical whaling voyages, where payoffs were similarly variable and driven by rare outsized outcomes.
  • Gross and Net US Investment — Net investment has fallen from ~40% of gross investment in the 1970s to ~25% today, meaning three-quarters of gross investment merely replaces depreciating assets. The shift toward faster-depreciating information technology assets requires larger gross investment increases to achieve any given gain in productive capital per worker.
  • Investment
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The College Wage Premium in the Generative AI Era

AI Summary. S. 575 between 2022 and 2026, the first sustained decline in relative demand for college-educated labor in four decades. AI exposure in white-collar occupations accounts for roughly 28% of that drop, as wage growth slowed disproportionately in high-AI-exposure jobs where college graduates are concentrated.

José Azar, Mireia Gine and Javier Sanz-Espín Social Science Research Network
Date Posted:
September 4, 2026
Is Database:
Database

The college wage premium flattened in the mid-2010s and has fallen ~8% since 2022. The authors argue that this compression reflects a broad decline in the returns to formal schooling, rather than a decline in the upper tail.

Is the college degree losing its economic value to artificial intelligence?

Core argument: The U.S. college wage premium fell from 0.626 to 0.575 between 2022 and 2026—the first sustained decline in relative demand for college labor after four decades of uninterrupted expansion.

After expanding for four decades, the U.S. college wage premium [dropped] sharply from 0.626 in 2022 to 0.575 in 2026. Current Population Survey data through 2026 implies an unprecedented drop in relative demand for college labor—the first sustained negative relative demand growth. Post-2022 wage growth slowed disproportionately in high-exposure occupations, which employ a disproportionate share of college graduates. By 2026, going from zero occupational AI exposure to full exposure had a negative effect on wages of−0.086. Combined with the college–non-college exposure gap, this mechanism accounts for roughly 28% of the total drop in the college wage premium from 2022 to 2026. While non-causal, these patterns indicate that task displacement in AI-exposed white-collar occupations plays a quantitatively meaningful role in the recent compression of the aggregate skill premium.

Takeaways by Macro Roundup® AI

  1. The U.S. college wage premium fell from 0.626 to 0.575 between 2022 and 2026—the first sustained decline in relative demand for college labor after four decades of uninterrupted expansion.
  2. Moving from zero to full occupational AI exposure reduced wages by 0.086 log points by 2026.
  3. the college–non-college AI-exposure gap accounts for roughly 28% of the total premium compression over that period.

Related Articles:

  • Looking for the Ladder — The downtick in hiring in AI-exposed occupations started 6 months prior to the release of ChatGPT, and is “perfectly” aligned with the start of Fed rate hikes…
  • How Students and Recent Grads are Responding to the Rise of AI — Far from shying away from AI, American undergraduates “are flocking towards the most-AI-exposed degrees,” with enrollment in these majors up 8% last year…
  • AI and Young-adult Jobs: The Real Mystery — Since the summer of 2023, the employment rate for Americans 22–25 has declined for both college grads and non-college workers, a phenomenon beyond both…
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Gross and Net US Investment

AI Summary. Net investment has fallen from ~40% of gross investment in the 1970s to ~25% today, meaning three-quarters of gross investment merely replaces depreciating assets. The shift toward faster-depreciating information technology assets requires larger gross investment increases to achieve any given gain in productive capital per worker.

Timothy Taylor Conversable Economist
Date Posted:
September 4, 2026
Is Database:
Database

U.S. real net private domestic investment—which adds to the American capital stock—is now only ~25% as large as gross investment, down from ~40% in the 1970s. Taylor suggests the widening gap between gross and net investment reflects the relatively rapid depreciation of IT-related capital.

Does faster asset depreciation explain slowing productivity growth?

Core argument: Net investment has fallen from ~40% of gross investment in the 1970s to ~25% today, meaning three-quarters of gross investment now merely replaces depreciating capital rather than expanding the productive stock.

The figure divides net investment by gross investment. Back in the 1970s, net investment was often around 40% of gross investment, but the share has been slumping over time. For the last decade or so, net investment has been about 25% of the gross–that is, about three-quarters of gross investment is just making up for depreciation of the pre-existing capital stock. The likely reason for the growing gap between gross and net investment is that modern investment is more likely to be related to information technology [which] depreciates more rapidly and thus needs to be replaced and updated more often. If we want the average US worker to be using a greater amount of capital on the job–which was one of the key drivers of rising labor productivity in the past–it now takes a bigger rise in gross investment to lead to a given rise in net investment.

Takeaways by Macro Roundup® AI

  1. Net investment has fallen from ~40% of gross investment in the 1970s to ~25% today, meaning three-quarters of gross investment now merely replaces depreciating capital rather than expanding the productive stock.
  2. The shift toward information technology — which depreciates faster than physical machinery — is the primary driver of the widening gap between gross and net investment.
  3. Raising capital per worker, a historic engine of labor productivity growth, now requires a substantially larger increase in gross investment than it did several decades ago.

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  • Capital Is Making a Comeback — Btw 1985-2021 the capital intensity of the American economy was relatively flat as a rise in intangible investment was offset by a decline in tangible…
  • The Transition to a Higher Cost of Capital — Bridgewater Associates co-CIO Karen Karniol-Tambour expects 10-year Treasury yields to rise from the current ~4.5% to compensate for structurally higher fiscal…
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The AI Re-Acceleration That Wasn’t

AI Summary. 615). Claims of re-acceleration result from cherry-picking frontier observations, selecting a breakpoint, ignoring variance collapse, and fitting separate lines on either side.

Paul Kedrosky Applied Complexity
Date Posted:
September 3, 2026
Is Database:
Database

Kedrosky argues AI capabilities continue to improve, but “the full composite data shows flattening relative gains, not acceleration…rolling relative model gains have fallen from their 2024 peak, while model dispersion has narrowed sharply.”

Are AI performance gains accelerating or just appearing to through selective measurement?

Core argument: Epoch’s Capabilities Index shows no statistically significant AI performance acceleration when controlling for developer and model family, with a breakpoint test returning p = 0.615 and a slope-change confidence interval of -8.4 to +23.4 pts per year.

Using all Epoch’s Capabilities Index observations, and controlling for developer and model family, there is no statistically significant breakpoint. A piecewise model—which splits the series into intervals and applies a sub-function to each segment—does not improve on a purely linear trend: p = 0.615, The estimated change in slope has a confidence interval of -8.4 to +23.4 points per year. In short, the maths shows there is no model acceleration, contrary to claims, and as expected. The result comes from selecting frontier observations only, choosing a breakpoint, ignoring variance collapse, and fitting separate lines on either side.

Takeaways by Macro Roundup® AI

  1. Epoch’s Capabilities Index shows no statistically significant AI performance acceleration when controlling for developer and model family, with a breakpoint test returning p = 0.615 and a slope-change confidence interval of -8.4 to +23.4 pts per year.
  2. Claims of AI re-acceleration rest on a methodological artifact: selecting only frontier model observations, pre-choosing a breakpoint, ignoring variance collapse, and fitting separate trend lines on each side of that breakpoint.

Related Articles:

  • Why .400 Hitters Disappeared — and What It Means for AI — As AI model performance converges toward a ceiling, relative gains per improvement cycle shrink, transforming frontier capability from a pricing moat into a commodity where price becomes the primary differentiator and margin pressure intensifies across leading providers.
  • Chart of the Day: Small Models are Closing the Gap to Frontier AI — Small AI models are closing the gap with large ones, achieving the same reasoning benchmarks with 142x fewer parameters than required two years ago. This makes on-device AI viable without data centers, compressing the economic case for cloud-based, per-query AI services.
  • Anthropic’s Best AI Model Struggles To Attract Users As Cheaper Tools Thrive — Spending on the most expensive AI model from a leading provider has plateaued at 11% of total outlay, as cheaper, older models prove capable of handling most business tasks.
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  • Productivity
    • Investment

Understanding AI and Productivity

AI Summary. U.S. productivity growth has accelerated to ~2.2% annually since mid-2022, above the 2010s baseline, though pandemic-era labor market and business formation dynamics likely contributed alongside AI. Historical general-purpose technology booms sustained labor productivity growth above 2.5% for a decade or more, making the current acceleration substantial but not unprecedented.

Chad Syverson Economic Innovation Group
Date Posted:
August 28, 2026
Is Database:
Database

Syverson is skeptical that AI initiated the rise in productivity growth that began in 2023. The acceleration began while AI investment was small, and pandemic-era labor market churn and business dynamism match the acceleration’s start.

Is AI-driven productivity growth sustainable at historical technology boom levels?

Core argument: U.S. labor productivity has grown at roughly 2.2% annually since mid-2022, a pace exceeding the 2010s trend and, if sustained, implying GDP per capita roughly 7% higher within a decade than the prior trajectory.

Productivity from mid-2022 on has maintained a faster-than-2010s trajectory involving annual growth of about 2.2%. Could this acceleration be due to AI? Perhaps. The timing leans against AI being the sole initial cause. Additionally, there were well-documented increases in economic dynamism (labor market churn and business formation) during the pandemic emergence whose timing matches the acceleration’s start. Regardless of AI’s current effect, the longer the aggregate productivity acceleration continues, the more plausible it is that AI is an important driver. As for the magnitude, a sustained increase from 1.5 to 2.2% annual productivity growth would be substantial (after a decade, GDP per capita would be 7% higher than otherwise), but hardly unprecedented. The 1995–2004 productivity boom saw annual productivity growth of nearly 3% per year, and other past general-purpose-technology-related productivity boosts saw labor productivity growth in excess of 2.5% for a decade or longer.

Takeaways by Macro Roundup® AI

  1. U.S. labor productivity has grown at roughly 2.2% annually since mid-2022, a pace exceeding the 2010s trend and, if sustained, implying GDP per capita roughly 7% higher within a decade than the prior trajectory.
  2. The 1995–2004 productivity boom averaged nearly 3.0% annual growth, establishing that a durable AI-driven acceleration to 2.2% would be meaningful but well within historical precedent for general-purpose-technology cycles.
  3. Pandemic-era surges in labor market churn and business formation align more precisely with the productivity acceleration’s start date than AI adoption does, complicating AI-as-sole-cause narratives.

Related Articles:

  • AI and Productivity — Rising US labor productivity is driven by higher capital utilization—factories, servers, and hotel rooms running harder—rather than new investment or efficiency gains at the individual task level.
  • Google’s AI & Economy ATLAS v1.0: Mapping Gemini Usage in the Economy — Google’s new AI & Economy ATLAS maps 15M AI interactions to occupations, tasks, and activities, showing AI use is pervasive but not intensive…
  • Writing Code vs. Shipping Code: Productivity Effects Across Generations of AI Coding Tools — Event studies indicate that adoption of AI coding tools raised “commits” (saved code updates) ~180%, but releases by only ~30%. Large upstream…
  • Investment
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US Widens AI-Driven Investment Gap With Europe

AI Summary. US corporate investment in equipment and facilities is projected to grow 40% in real terms by the end of next year, versus 12% in the euro area, widening a productivity gap where output per hour worked rose $14 in the US compared with $2 in Europe since 2018.

Sam Fleming, Amy Borrett and Olaf Storbeck Financial Times
Date Posted:
August 24, 2026
Is Database:
Database

Oxford Economics projects US real business investment will rise 40% over 2021–2027, ~3x the euro area’s 12%. US investment growth since 2024 has been largely information processing and software, but high US growth in GDP/hour is not “merely digital.”

Is artificial intelligence investment widening the transatlantic productivity divide?

Core argument: U.S. corporate investment in equipment and facilities is projected to rise 40% in real terms between 2021 and end-2026, versus 12% in the euro area and near-zero growth in Germany, sharply widening the transatlantic capital-spending gap.

Corporate spending on new equipment and facilities in the US is projected to increase 40% in real terms between 2021 and the end of next year, according to forecasts from Oxford Economics. The US surge compared with a real-terms increase of just 12% in the euro area, while German business investment is expected to have all but stagnated over the same period. Europe also faces a large and growing productivity gap with the US. “The United States has recently pulled further ahead of Europe,” Bart van Ark, a professor at the University of Manchester, told policymakers at the ECB Forum in Sintra. GDP per hour worked increased $14 in the US between 2018 and 2025, compared with just $2 in Europe. “The gap is not only a digital sector story,” added van Ark, stressing that the US outperformance extended to other sectors, including wholesale and retail as well as professional services.

Takeaways by Macro Roundup® AI

  1. U.S. corporate investment in equipment and facilities is projected to rise 40% in real terms between 2021 and end-2026, versus 12% in the euro area and near-zero growth in Germany, sharply widening the transatlantic capital-spending gap.
  2. U.S. labor productivity rose $14 per hour worked between 2018 and 2025, versus $2 in Europe, with outperformance spanning wholesale, retail, and professional services—not solely the digital sector.

Related Articles:

  • The Two Europes — The European Union contains two divergent economies: a reforming frontier energized by security threats, and a stagnant interior where structural reform pressure remains absent.
  • Ed Conard Debates Furman On “The Expected Value of Risk Taking” — 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…
  • The Future of European Competitiveness – A Competitiveness Strategy for Europe — An EC study of European competitiveness finds that EU gross value-added per hour worked increased by 0.7%/year from 2000-19, vs. 1.2%/year in the US. “Europe…
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