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
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…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
  • “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
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “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 fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…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
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
Upside of Inequality Oxford Unintended Consequences

Nat Malkus and Sam Hollon American Enterprise Institute
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A large sample of Indiana high school students shows a near-linear relationship between 8th grade math test scores and participation in varsity athletics. Academic success and participation in extracurriculars appear to be complementary.

We find large gaps in varsity sports participation by academic achievement, which we measure using students’ eighth-grade math test scores. Students who attended the smallest schools (first quintile) were 2.8 times as likely to participate in varsity sports as those who attended the largest schools (fifth quintile). We find that after adjusting for school size 35% of students in the top achievement quintile played varsity sports in 2025, compared with just 12% of students in the bottom quintile. In general, the relationship between achievement quintiles and varsity sports participation was remarkably linear. [The exception was football], the largest sport by participation [17% of all varsity athletes and overwhelmingly male]. Here the top quintile [in 8th grade math] had 20% lower odds of playing than students in the middle achievement quintile.

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AI Summary. Non-college workers ages 22–34 are experiencing historically low unemployment relative to their own two-decade range, outperforming college-educated peers on that relative measure. College graduates still hold an absolute advantage, with a 2.7% unemployment rate versus 4.7% for high-school-only workers.

Theo Francis and Ray Smith Wall Street Journal
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In 2026, the 12-month moving-average unemployment for college-educated 22–34-year-olds is above its post-2003 mean, while the rate for non-college peers is historically low. Prime-age college grads still have lower unemployment than those with no degree.

Is the job market finally tightening for workers without degrees?

Core argument: Non-college workers ages 22–34 are experiencing one of their strongest job markets in two decades, with unemployment rates near historic lows relative to their own 2003–present range, outperforming their college-educated peers on that relative measure.

The unemployment rate for workers ages 22 to 34 who never graduated from college has rarely been lower in the past two decades. To gauge how the job market has shifted for each cohort, [Gad Levanon, Burning Glass’s chief economist] compared current unemployment rates for the different groups with their own range of unemployment rates since 2003. The analysis included data through July. By that measure, the job market looks much better for blue-collar workers, including those in construction and on manufacturing lines, and manual-service workers. It is [however] still easier to find a job with a college degree. The unemployment rate for degree-holders in their prime working years—ages 25 to 54—averaged 2.7% for the 12 months ending in July - well below the 3.6% rate for workers with just some college education, and 4.7% for people with a high-school diploma only.

Takeaways by Macro Roundup® AI

  1. Non-college workers ages 22–34 are experiencing one of their strongest job markets in two decades, with unemployment rates near historic lows relative to their own 2003–present range, outperforming their college-educated peers on that relative measure.
  2. On an absolute basis, a college degree still confers a significant labor-market advantage: prime-age degree-holders averaged 2.7% unemployment versus 3.6% for some-college workers and 4.7% for high-school-only workers over the 12 months ending July.

Related Articles:

  • College Grads Struggle to Find Jobs. Non-Grads Are Giving Up — The narrowing unemployment gap between young college graduates and non-graduates reflects rising labor force dropout among non-graduates, not equal job market outcomes; the share of young non-graduates who are employed is 1.7 percentage points below pre-pandemic levels and falling, while graduates are near recovery.
  • To Fix Education, Fix The Economy First — Using OECD skills data and the Luxembourg Income Study, Burn-Murdoch finds US workers at the lowest levels of literacy and numeracy earn ~ on par with British…
  • The College Wage Premium in the Generative AI Era — 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.

AI Summary. Global student performance in mathematics and reading has declined sharply since 2018, with reading scores falling 14 points and math scores falling 9 points between 2022 and 2025 alone.

OECD Staff Organisation for Economic Co-operation and Development
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Mean OECD math and reading scores fell roughly 25 PISA points—about a year of schooling—between 2018 and 2025, alongside reduced motivation and engagement and increased carelessness, exemplified by a near-doubling of “hasty readers.”

Are global education systems failing to teach core skills?

Core argument: The share of “hasty readers” — students giving fast, incorrect responses — nearly doubled from 7% in 2018 to 11% in 2025, with math showing a parallel rise between 2022 and 2025, signaling deteriorating effort and engagement rather than pure skill loss.

In math, performance remained close to the 2003 level up to 2018, then dropped sharply btw 2018 and 2025. Mean performance dropped by 9 score points in mathematics and about 14 score points in reading btw 2022 and 2025. Over the 2018-2025 period, the largest drops [in reading] were among the most advantaged 25% of socio-economic status, and the socio-economic gap with the most disadvantaged students reduced somewhat, by 11 points, on average across 35 OECD countries. In mathematics, the share of disadvantaged students scoring below proficiency Level 2 increased in previous cycles and remained high in 2025; among advantaged students, the share scoring below proficiency Level 2 increased, reaching 18% in 2025, about 4pp. Students’ reports of their motivation for learning and engagement with school also declined between 2022 and 2025. The proportion of “hasty readers” – those who gave fast and incorrect responses – increased by about five percentage points, on average, from almost 7% in 2018 to 11% in 2025. Analyses for math, also show an increase in the proportion of hasty responses between 2022 and 2025.

Takeaways by Macro Roundup® AI

  1. The share of “hasty readers” — students giving fast, incorrect responses — nearly doubled from 7% in 2018 to 11% in 2025, with math showing a parallel rise between 2022 and 2025, signaling deteriorating effort and engagement rather than pure skill loss.
  2. Among the most advantaged quartile of students, the share scoring below math proficiency Level 2 reached 18% in 2025, up approximately 4 percentage points, indicating that academic decline is no longer concentrated among disadvantaged populations.

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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
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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.

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AI Summary. The narrowing unemployment gap between young college graduates and non-graduates reflects rising labor force dropout among non-graduates, not equal job market outcomes; the share of young non-graduates who are employed is 1.7 percentage points below pre-pandemic levels and falling, while graduates are near recovery.

Justin Fox Bloomberg
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Labor force participation is rising for American college graduates aged 25–29, and is now at 89.4% – above its pre-pandemic level. Participation among non-college members of that age cohort is falling; at 78.7%, it is now below its pre-pandemic level.

Are non-graduates disappearing from the job market?

Core argument: The narrowing education-unemployment gap among young adults reflects labor force withdrawal by non-degree holders—not diminished diploma value—as workers who stop seeking jobs are excluded from unemployment calculations.

The narrowing of [the unemployment gap btw college and non-college workers] in recent years has lent support to narratives that college diplomas are losing their value amid the rise of large language models, the purported return of blue-collar work, and other job market changes. But while it may well be that diplomas have lost value, the recent shrinking of the young-adult education-unemployment gap seems to be driven mainly by a different phenomenon. Growing numbers of young adults without college degrees simply aren’t trying to find work and thus aren’t counted in unemployment calculations. The employment-population ratio for young college grads is not far off from where it was just before the pandemic and seems as if it might be headed upward again after a sharp drop in 2023 and 2024, for non-grads it is 1.7 percentage points lower than before the pandemic and clearly trending downward.

Takeaways by Macro Roundup® AI

  1. The narrowing education-unemployment gap among young adults reflects labor force withdrawal by non-degree holders—not diminished diploma value—as workers who stop seeking jobs are excluded from unemployment calculations.
  2. Young adults without college degrees carry an employment-population ratio 1.7 percentage points below pre-pandemic levels and trending downward, while college graduates have nearly recovered to pre-pandemic parity.

Related Articles:

  • Labor Force Participation Is High If You Measure It Right — The overall labor force participation rate is a misleading measure of labor market health because it does not account for age-related variation in work patterns, making it especially distorted when large population groups shift into retirement-age brackets.
  • How Labor Force Participation Has Diverged Across Genders — Male labor force participation has fallen steadily since the 1970s, while female participation rose sharply before plateauing, driven by shifts in education levels and age composition rather than a single cause.
  • AI, Immigration, and Collapsing Labor Force Participation — Declining labor force participation concentrates economic output among fewer workers, raising the return on automation and making productivity growth the primary driver of expansion. Any productivity shortfall carries greater consequences because a shrinking worker base cannot compensate through increased participation.

John Burn-Murdoch Financial Times
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Using OECD skills data and the Luxembourg Income Study, Burn-Murdoch finds US workers at the lowest levels of literacy and numeracy earn ~ on par with British workers scoring a 2, ~ a mean score.

30% of US adults have literacy skills typical of a 10-year-old. The same proportion of US workers who score stunningly low on literacy earn an average of almost $30 per hour, and two-thirds of them are in work. Their British counterparts make the equivalent of $20 and fewer than half are employed. This all looks more like the fruits of years of stronger growth than vocational education policy. We should view education as creating potential that a strong economy unleashes (and a weak one disappoints).

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AI Summary. Top-scoring Chinese students are increasingly choosing police and military academies over elite universities, with admission scores for some programmes reaching 650+/750 — placing them within 3 points of the country's most prestigious university. Public-sector job security is driving high achievers toward state institutions, with military academy entrants ranking on average

Sun Yu Financial Times
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Gaokao scores are rising at police and military academies in China as the labor market deteriorates. Applicants to the top courses at a top police academy fell only three points short of the minimum score for early admissions to the least competitive course at Tsinghua.

Are top students abandoning elite universities for government security jobs?

Core argument: Military academy entrants in China ranked in the top 6% of gaokao candidates province-wide on average, signaling that public-sector career guarantees now rival elite universities in attracting top academic talent.

Chinese high school graduates are increasingly shifting their sights towards police and military academies and other institutions that offer a clear path to public-sector jobs. Admission scores needed for some of these institutions have jumped — with some undergraduate courses requiring more than 650 points out of a maximum of 750 — reflecting strong demand from high-achieving students. Some of their courses are now as tough to enter as the least competitive subjects at top-tier universities. Applicants to the most competitive programmes at the People’s Public Security University of China (PPSUC) needed 652 points out of 750 in this year’s gaokao in Jiangsu, one of China’s wealthiest provinces. That was just three points below the minimum score for early admissions to the least competitive course at Beijing’s Tsinghua University, the country’s most prestigious university. China’s defence ministry said that students admitted to military academies this year ranked, on average, among the top 6% of gaokao candidates in their provinces.

Takeaways by Macro Roundup® AI

  1. Military academy entrants in China ranked in the top 6% of gaokao candidates province-wide on average, signaling that public-sector career guarantees now rival elite universities in attracting top academic talent.
  2. Applicants to the most competitive programmes at the People’s Public Security University of China required 652 out of 750 points in Jiangsu—just 3 points below the minimum for Tsinghua University’s least competitive early-admission course.
  3. Admission scores for select police and military academy programmes have crossed 650 out of 750, placing their entry thresholds on par with the bottom tier of China’s most prestigious universities.

Related Articles:

  • Incentives And Outcomes — U.S. industrial firms face a structural talent disadvantage because engineering graduates are drawn to higher-paying technology and finance roles, leaving manufacturers unable to compete for skilled workers the way industrial employers in France, Germany, Japan, and China can.
  • Do Adults Have the Skills They Need to Thrive in a Changing World? — The 2023 OECD Survey of Adult Skills reveals the US has ~ 3 low-scorers for every high-scorer. Germany has nearly 3X as many high-scorers per low-scorer as the…
  • Military Officer Quality in the All-Volunteer Force — A sharp and steady decline in the GCT scores of Marine Corps officers occurred btw 1980 and 2014. 96% of this is explained by the widening (and weakening) of…

Ying Bai and Ruixue Jia National Bureau of Economic Research
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From 1644–1905, Qing China staffed its bureaucracy through exams and patronage. Only 12.6% of exam graduates reached top office, but patronage favored stronger performers, illustrating how merit and connections can be complements rather than substitutes.

Figure 5 studies the interplay between merit and networks by estimating the effects of exam performance and ties to powerful examiners separately for the high- and low-performing categories. The left panel shows the effects of exam performance for the two categories, while the right panel presents those of examiner power. Two patterns stand out. First, exam performance matters more for the high category, consistent with the institutional design that steered this elite group toward more prestigious careers. Second, ties to powerful examiners are also more valuable for the high category, pointing to a complementarity between merit and networks. To understand the implications of our finding on complementarity, it is useful to contrast it with the counterfactual of substitution. When merit and networks are complements (rather than substitutes), those who attained top office tend to exhibit both stronger exam performance and stronger connections. By contrast, under substitution, strong networks would compensate for weaker exam performance, and vice versa. Complementarity implies [a higher degree of meritocracy than substitution, as] successful candidates appear to have had better performance. Second, complementarity makes it harder to identify the influence of networks: their effects can operate under the guise of merit rather than as a visible substitute for it.

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