What I’ve been reading
1. Allison Schrager is very good, including her new book Worth the Risk: The Seven Myths that Keep Us from Taking the Chances We Need to Take.
2. Dialogues of Confucius, translated and edited by Brian Buya and Wenwen Li. It seems these works, once considered doubtful in provenance, are likely by Confucius after all? So this is an epic volume of real import. But does it raise my opinion of Confucius as a thinker? No.
3. I liked all of Thomas F. Madden’s The Fall of Republics: A History from Ancient Carthage to the American Constitution, but most of all the section on Venice.
4. Frank Callanan, James Joyce: A Political Life. An excellent book, and it truly induces us to revalue Joyce and understand him in a new light. Joyce was in fact highly politically conscious, heavily influenced by Parnellism, and in part writing a critique of Irish nationalism from an internal perspective.
4. Alastair Reynolds, “Zima Blue,” one of the better short stories about AI, and also aesthetics. Via R.
5. Justin Gest, Democratic Drain: Global Migration and the Struggle for Democracy is a political economy argument that widespread immigration can drain home countries of their democracy supporters to some extent.
Daniel Susskind, What Should My Children Do?: How to Flourish in the Age of AI is a book that needed to be written.
Melissa S. Kearney and Luke Pardue, editors. Demographic Headwinds: The Economic Consequences of Lower Birth Rates and Longer Lives. A short volume, to the point, worry is in order.
And there is Jeremy A. Simmons, Sea of Treasures: A Cultural History of Ancient Indian Ocean Trade.
Bastiat’s telephone?
- Oakland has seen a 37% decrease in car break-ins over the last year.
- What’s good news for car owners is less so for repair shops that specialize in window and windshield replacements.
- Multiple businesses have reported a sharp decline in their income as a result.
Here is the article, via Air Genius Gary Leff.
Sunday assorted links
2. Short TV clip of me on the Brazilian economy.
4. “Thrilled to announce the inaugural cohort of the 1991 Fellowship @mercatus. Meet some of the most talented and creative minds working on challenging policy problems at the state level in India.” Link here.
5. AI has won another literary prize.
6. Roon on worship. Roon is one of our best thinkers.
Labor market effects of the Tax Cuts and Jobs Act
The Tax Cuts and Jobs Act (TCJA) of 2017 represents the most significant reform of the U.S. income tax code since the Tax Reform Act of 1986. Previous analyses of the TCJA’s economic impact often rely on estimates based on data prior to the enactment of the legislation. This paper leverages plausibly exogenous variations in state-level tax changes brought about by the TCJA and employs local projections with two-way fixed effects to examine its effects on the labor market. Measures of TCJA tax shocks are constructed with the NBER-TAXSIM model using state-level tabulations of individual income tax returns from the Statistics of Income (SOI). Our findings suggest that tax cuts amounting to 1 percent of Adjusted Gross Income (AGI) under the TCJA are associated with a 0.7–1 percentage point increase in the labor force participation rate (LFPR) and a 0.8–1.5 percent increase in payroll employment over the two years following the TCJA’s implementation. These results appear broadly robust to assumptions about heterogeneous state responses and the inclusion of interactive fixed effects.
That is from a newly published article by Anil Kumar. Via the excellent Kevin Lewis.
Music markets remain deglobalized
It might seem surprising, in a world of global stars, that the 6m Danes, many of whom are fluent in English, listen mainly to homegrown music. And until fairly recently they did not. In 2019 only five songs in Denmark’s top 20 were in Danish. By last year the figure was 18.
A similar trend is under way in other countries—and in other forms of entertainment. From Asia to the Americas, music charts are increasingly dominated by local sounds. Hollywood television-streaming companies are commissioning more local productions in foreign markets, causing consumption of American shows to fall. Social networks are connecting the whole world, but so far people are mainly using them to consume local content. And as video gaming expands, it too is becoming increasingly tailored to local cultures…
In 2023 Will Page and Chris Dalla Riva noted in a London School of Economics paper that a number of European countries including France, Germany, Italy and Poland had seen rising domestic shares of their top tens in the preceding decade. Since then the phenomenon seems to have spread. Mr Page, formerly chief economist at Spotify, finds that 55% of streams of songs in Sweden’s top 20 last year were in Swedish, up from 29% in 2019. Norway’s figure rose from 13% to 38% in the same period.
That is from The Economist, and of course it echoes themes from my earlier Creative Destruction: How Globalization is Changing the World’s Cultures. And Brazil most of all?
Latin America has gone the same way (see chart 1), Brazil astonishingly so: in the first week of June 96 of the top 100 artists on YouTube Music in the country were Brazilian (foreigners included Justin Bieber and Michael Jackson). Last year Thailand had a solidly local top ten, while Indonesia and the Philippines each had eight local tracks in their respective charts; Nigeria’s top ten were all local, as were nine of South Africa’s, according to the IFPI, which represents the recorded-music industry.
The same trends are happening for television as well, albeit less radically.
My aesthetics podcast with Benjamin Lima
Spotify: https://open.spotify.com/episode/0HBFWS1avb6tYY1IoLefYb
Web: https://athenaeumreview.org/podcast/aesthetics-a-conversation-with-tyler-cowen/
Here is basic information about art scholar Benjamin Lima, it was great fun for me to do this one.
Saturday assorted links
1. Do weird corporate governance structures work well?
2. Are elite economists overpaid? Elite economists conclude no.
3. Dialog.
5. Inside the world’s first AI art museum (Los Angeles).
The Free Press summer reading list
I was asked to nominate so here goes:
Free Press columnist Tyler Cowen picks a biography of one of the finest poets of the 20th century, Paul Celan: A Life, by Anna Arno.
Could Celan be the very best poet of all time? When read in the German language, I think he might be. When read in English, he is still very good. No one has a poetic topic of more importance than the Holocaust. Contrary to Theodor Adorno, he decided it was possible to write poetry after it, and he took that mission very seriously.
Now we finally have a first-rate biography. Celan’s mother was killed in the Holocaust, and he took his own life in 1970, drowning himself in the Seine. How did he get to that point? How did he have the strength and wherewithal to write such powerful poetry in the first place?
I found this book gripping from start to finish. Given the topic I cannot call it a “fun” read, but it is absorbing and the translation is very accessible.
Is it possible that Anna Arno is one of our best intellectuals today? She has written on the German painter Paula Modersohn-Becker and the Polish writer and activist Konstanty Jeleński, and has done important work as a translator, including of Henry James—though those works are in Polish, and thus inaccessible to me. Can we get translations as soon as possible? In the meantime, you can start with this one.
The article has many other quality selections as well.
Adrian Wooldridge on Sweden and liberalism
Sweden is continuing to reap the rewards of this mixture of fiscal rectitude and pro-market reforms. GDP is projected to grow by 1.8% to 1.9% this year; headline inflation stands at 1.5%; debt-to-GDP ratio is one of the lowest in the world, at just above 35%.
There are some flies in this ointment, of course: The economy has recently endured a bout of stagnation, unemployment is at an uncomfortably high 9.4% and Sweden has one of Europe’s highest rates of household debt. But the business environment is healthy, particularly when it comes to business to business. Sweden has a diversified business scene — the highest number of unicorns per capita in Europe, with notable successes such as Spotify, but also a healthy manufacturing and engineering sector. Many of these established companies are thriving because of a surge in demand for both server farms and military equipment…
Sweden has recently experienced its first net emigration in 50 years, thanks to higher minimum wages for labor visas, tougher citizenship tests and, most controversially, financial payouts of up to $37,000 for refugees who volunteer to leave. It has also made progress against violent crime in the immigrant-heavy suburbs, increasing police numbers and toughening the penal code, including a boost to stop-and-search powers and a lowering in the age of criminal responsibility to 14. The number of shootings fell by 63%, from 390 in 2022 to 147 by the end of 2025.
Here is the full Bloomberg column. And here is Adrian’s new book on liberalism, self-recommending.
Important committees in history
Robin Hanson queries:
Missing book: Glorious Committees of History, on great committees that accomplished great things as committees.
GPT Pro has an impressive response, here is the start:
1. The King James Bible translation companies. This is maybe the purest literary example: 47 scholars organized into six companies at Westminster, Oxford, and Cambridge, with review procedures, producing one of the monuments of English prose. The committee form mattered because it blended scholarship, doctrinal acceptability, and a shared ear for cadence.
And Henry Oliver suggests The Great Exhibition?
Friday assorted links
1. Liberalism and weaponized interdependence.
2. Is the AI shock like the China shock?
3. Can AI agents be individuated?
4. Who is liked by GPT 5.5? (from a partial list, if I understand this correctly)
6. Noah Smith is fearing that he and many others are having less influence.
Our colleague Vincent Geloso has a Substack
How research in math will change (from my email)
From GA:
I am a mathematician…and some of your recent comments on MR about the role of AI in Econ research as well as the (disappearing?) role of academic papers inspired this response. (It is partially but not exclusively about academia, so I hope it is ok that I’m sending it to your GMU address. Also, I’m hoping it doesn’t get flagged as spam because of the ai in the title…)
In no particular order:
-In the course of a math career, one accumulates lots of computational guesses, now one can test those with minimal effort.
-One also accumulates lots of incomplete and half formed drafts, proofs of special cases, etc, etc. Running those past claude and chatgpt can (does!) pay off. A lot of math is cleverly applying linear algebra and while I’m very good at linear algebra, I’m not as good at it as the AI’s are.
-The lower hanging fruit here are slightly off the beaten track, but not esoteric subjects. If you have a good overview of such, you can pretty quickly prod ai’s into making progress on them. (Before, you needed to have a school of grad students for that). Basic techniques (graph theory, algebra, calculus..) that ai’s are already good at can push these forward already. Making progress on truly hot topics is harder.
-There are some quite smart people trying to measure just how good autonomous ai’s are at math (e.g. the first batch project). That’s a fun game, but for practical purposes right now, what is relevant is how good an ai is when guided by a motivated human. I suspect we’ll see some remarkable things on that front in the next few years once math people really grok the good routines.
-For instance, getting claude and chatgpt to referee each other’s arguments is fun, and they genuinely have different insights on parts of the same problem.
-The kids will be all right. Right now, they are making pocket change doing ai training developed a better “feel” for the different ai’s that I probably ever will. And they learn things by asking the ai to explain an argument to them instead of trying to decipher a math book or paper.
-Which brings me to your papers point. I notice that a project informed with the right context is much more informative to me than the physical pdf of a math paper, and much easier to extract information out of by just asking the thing.
-Refereeing will look very different very soon. All the referee reports that have been collected by the journals should be valuable, hard to get data. And running all the accepted and published math papers through ai’s as the `control’ will end with quite a few people having egg on their face. It’s like self-driving cars, but there is no refereeing union.
-The last really big math revolution was all the stuff in the wake of Witten and 4-manifold stuff predicted by string theory in the early 90’s. This is going to be so much bigger than that. Buckle up.
Thursday assorted links
AI-Native Firms
Very important work from Hyunjin Kim and Rembrand Koning. Insead and HBS respectively:
We study how firms built around AI capabilities-“AI-native” firms-are organized. Drawing on Y Combinator batches W20-F24 and U.S. venture-backed startups whose first financing closed between 2020 and 2024, we classify each firm’s AI-native status and link it to workforce microdata on team size, function, seniority, and hierarchy. Relative to non-AI startups in the same industry-cohort, AI-native firms are 25% smaller. Their share of engineers is 13% greater, and the shares of entry-level workers and managers are each roughly 15% lower. Their hierarchies are half a seniority level flatter-yet valuations are comparable, implying more value created per employee. We argue these patterns reflect two channels: a process channel, in which AI changes how people work inside the firm, and a product channel, in which AI capabilities are built into what the firm sells. Using text from product descriptions and job postings, we find that embedding AI into the product, beyond layering on AI tools into existing workflows, is a primary way startups are scaling “knowledge work” without large teams of knowledge workers.
The tweet storm on the new paper is especially useful. Via Luis Garicano. And note those results predate the very latest and best tools.