The Dangerous Economist

Monday, July 20, 2026

The surprising link between science fiction and economic history

By Sebastian Buckup. He is Head of Programming, Global Programming Group, Member of the Executive Committee, World Economic Forum. Today is National ScienceFiction Day. Excerpt:

"Exactly 200 years ago, in 1816, a teen-aged girl called Mary Shelley began writing the story of Frankenstein in a villa in Cologny, a short walk from where the World Economic Forum now has its offices. Her ghoulish but subtle tale featured a scientist bringing a sentient, suffering creature to life from parts found in the “dissecting room and the slaughter-house".

“Frankenstein” was written at the end of the First Industrial Revolution, capturing the fears and squeamishness of a society going through massive transformations whilst making its first forays into surgery. The book took inspiration from earlier critics of the dawn of industrialisation, among them John Milton and Samuel Taylor Coleridge.

Today, Shelley’s Frankenstein is seen as the start of a genre, the first work of science fiction. By imaginatively combining the rigour of science with the freedom of fiction, the genre plays a big role in expressing the hopes and fears we project into our creations.

The best sci-fi stories mix two ingredients. The first is great science which sometimes leads to surprising accuracy: Jules Verne imagined a propeller-driven aircraft in the early 19th century, when balloons were the best that aviation had to offer. In the 1960s, Arthur C. Clarke envisioned the iPad, and Ray Bradbury the Mars landing. It may just be a matter of time until “Samantha”, the AI voice in Spike Jonze’s film Her, will be real, or until we bump into a version of “Ava”, the humanoid robot from Alex Garland’s “Ex Machina”.

The second ingredient is a keen understanding of contemporary hopes and fears. This is what makes these books and films great tools for dissecting the sentiments of an era. The two most successful sci-fi stories ever, George Lucas’ Star Wars and Gene Roddenberry’s Star Trek, are amongst the best examples of how pop culture combined perceptions of technological progress with contemporary hopes and fears."

Sunday, July 19, 2026

The Economics of Friendship

Why does loneliness seem to be on the rise? In part because we’ve made life frictionless and efficient

By Roland Fryer. He is an economics professor at Harvard. Excerpts:

"sometimes waiting does something useful: It forces people into the same place, with nothing to do, long enough for conversation to begin."
"Some inconveniences aren’t merely costs. They are the hidden scaffolding of social life."
"Proximity matters most when it recurs. Idle time matters most when nobody is trying to impress anyone."
"friendship is often a product of something else: work, school, church, children, sports, errands, waiting rooms. It is produced not by misery, but by enough common friction to make conversation natural. Modern life has spent decades eliminating that friction. We can work without offices, shop without stores, exercise without gyms and communicate without looking anyone in the eye. Each improvement is defensible, some phenomenal. Together they have made interaction with other people increasingly optional."
"Can we prove that the pursuit of frictionless living has contributed to an unintended loneliness epidemic? Not easily. But the data fits better than I expected. Using state-level loneliness measures from the U.S. Census Bureau’s Household Pulse Survey, I compared loneliness with three proxies for modern convenience: working from home, broadband-enabled living, and the share of commuters who still move through public or pedestrian space."
"States where more daily life can be conducted privately—at home, online, on a screen—tend to report somewhat more loneliness. States where more people commute by public transit or walking tend to report less. Places built around private convenience look lonelier than places where daily routines force people to bump into one another. After accounting for age, income and who lives alone, the relationship weakens but remains statistically significant."
"When the ordinary logistics of life no longer require us to encounter one another, the ties that begin in those encounters become harder to form."
"there is no clean market for friendship. That isn’t because friendship lacks value. It is because friendship is hard to sell directly."
"The moment one says, “I am here to buy friendship,” the thing being purchased changes. Markets are powerful when the good is clear, the price is observable, and the transaction is socially acceptable. Friendship fails on all three margins."
"friendship is usually produced indirectly"
"[frictions] put us near one another often enough that trust can accumulate without anyone having to announce that trust is the goal."
"Potential friends are everywhere; good matches are hard to find"
"there is no résumé for a good friend. Institutions reduce those search costs. The office hallway lowers the cost of a first conversation. The school pickup line does the same. So do the church basement, the neighborhood barbecue, the youth-sports sideline and the ferry queue."
"Cities should build and preserve libraries, parks, playgrounds, walkable streets and mixed-use spaces as amenities and places where low-stakes contact can happen." (this raises the question of should the government help provide us with a social life and how much does that cost and is it worth it-those may not be easy questions to answer)

Venmo Etiquette: How to Navigate Digital Debts Between Friends: Payment apps make it so much easier to share expenses with people. But that leaves us with a lot of difficult questions (2025)

If a Friend Bills You $4 for a Favor, Are They Really a Friend? Surprise Venmo requests are souring relationships and revealing just how closely some of us keep score (2024)

More on the social aspects of Venmo (2018)

Is Venmo Affecting Friendships? (2017)

Who Pays on the First Date? No One Knows Anymore, and It’s Really Awkward (2017)

Yes, You Can Have Too Many Friends (2009)

You Think You’re Doing Fine in Life, Until You Hear a Friend Is Doing Better (2024)

If It Pays To Have Friends, Can You Pay To Have Friends? (2013)

The Incredibly True Story of Renting a Friend in Tokyo (2020)

Would You Pay $250,000 To Get Your Friends' Respect? (2011)

Excerpt: But here is something interesting about one student, who is now $250,000 in debt:

"Mr. Wallerstein, for his part, is not complaining. Once you throw in the intangibles of having a J.D., he says, he is one of law schools' satisfied customers.

"It's a prestige thing," he says. "I'm an attorney. All of my friends see me as a person they look up to. They understand I'm in a lot of debt, but I've done something they feel they could never do and the respect and admiration is important.""

Saturday, July 18, 2026

Would you pay someone to make it look like you have read a book that you actually did not read?

This post is a follow up on yesterday's post. It is another one about how people engage in fakery to get what they want. I have done many other posts on this and links to them are provided below.

See ‘Coffee must be dropped at different height than wine’: The Berlin team making books look well-read: An idea to make books look a bit more used, once jokingly proposed by one Myles na gCopaleen, has been made real in German capital by Derek Scally of The Irish Times. Excerpts:

"In a Berlin bar’s back room, Cabinet Magazine, a literary quarterly, assembled a crack team of white-coated literary experts to make your unread books look well-read – at moderate prices.
For €5 you could get an “essential” handling package including a “professional” spine-break for your book, “two commonplace page markers, 2 scholastic dog-ears; 4 underlined passages; 1 arbitrary yet discerning piece of marginalia; and 1 contextually appropriate piece of marginalia”.
The premier package added “mauling the edges” of the book with a drill and sand paper, thanks to the “vice-chiefs of abrasion (light, heavy)” as well as “one stain using cheap wine, coffee etc”, hand-applied by a “fluid dynamics specialist”."
"Among the 40 books handled on Sunday evening were an unread volume gifted to a woman by her mother a year ago – three days before the mother’s next visit. (she paid money to make it look like the book was read so her mother would not give her a hard time or make her feel guilty).
Another visitor wanted their new copy of the 1,000-page Arcades Project by Walter Benjamin to look as well-read as the lost copy it was replacing."

Renters Are Conning Their Way Into Luxury Apartments: Atlanta, where up to half of rental applications contain fraudulent information, is epicenter of national surge in these scams (2025)

Online Returns Fraud Finds a Home on Telegram, Costing Retailers Billions: Efforts to exploit retailers’ return programs are growing more organized, fueled by websites and messaging accounts that target merchants (2024)

In Poorer Countries, Obesity Can Signal Financial Security (2023)

Fake Books Are a Real Trend (and people pay money for them) (2023)

Job Listings Abound, but Many Are Fake (2023)

You can hire someone to do the job interview for you (2022)

How to Spot Fake Reviews and Shady Ratings on Amazon (2022)

Making Money Off of Fake ATM Receipts (2021)

People are hiring out their faces to become deepfake-style marketing clones (2021)

Why would men bring fake cell phones to bars? (2021)

Are sellers paying Amazon customers to delete negative reviews? (2021)

Fake Reviews and Inflated Ratings Are Still a Problem for Amazon (2021)

Photos show China's most surreal tourist spot— a fake Instagram-worthy town full of pretend farmers and phony fishermen (2021)

The Myth of Authenticity Or The Story Behind Products (2010)

Fake Authenticity (2011)

Students: Make a mistake on purpose, its good for you! (2007)

A fake job reference can be just a few clicks away (2015)

Fake Economist Fools Portugal (2013)

Slave Redemption in Sudan (2007) (Fake slaves are sold to those who buy slaves and then give them their freedom)

Can A Product Work Just Because It's Expensive? (2008) (fake medicine)

If It Pays To Have Friends, Can You Pay To Have Friends? (2013) (you can hire fake boyfriends)

Study: Half of American Doctors Give Patients Placebos Without Telling Them (2008)

Saudis grapple with fake street sweepers (2017)

Rent a White Guy: Confessions of a fake businessman from Beijing (2010) (by Mitch Moxley in The Atlantic Monthly, excerpts below)

Can adding a phantom third story to their homes help families find a wife for their son? (2018)

Why do employers pay extra money to people who study a bunch of subjects in college that they don’t actually need you to know? Signaling (2018)

Mexicans buy fake cellphones to hand over in muggings (2019)

Conspicuous Consumption, Conspicuous Virtue, Thorstein Veblen (and Adam Smith, too!) (2007)

How does a company selling used luxury goods spot fakes? (signalling and conspicuous consumption) (2019).

Why do stores sometimes pay people to be fake shoppers? (2019)

What if companies can't afford real models for their ads? Use AI generated fake pictures (2020)

Excerpts from "Rent a White Guy"

"Not long ago I was offered work as a quality-control expert with an American company in China I’d never heard of. No experience necessary—which was good, because I had none. I’d be paid $1,000 for a week, put up in a fancy hotel, and wined and dined in Dongying, an industrial city in Shandong province I’d also never heard of. The only requirements were a fair complexion and a suit.
“I call these things ‘White Guy in a Tie’ events,” a Canadian friend of a friend named Jake told me during the recruitment pitch he gave me in Beijing, where I live. “Basically, you put on a suit, shake some hands, and make some money. We’ll be in ‘quality control,’ but nobody’s gonna be doing any quality control. You in?”
I was.
And so I became a fake businessman in China, an often lucrative gig for underworked expatriates here. One friend, an American who works in film, was paid to represent a Canadian company and give a speech espousing a low-carbon future. Another was flown to Shanghai to act as a seasonal-gifts buyer. Recruiting fake businessmen is one way to create the image—particularly, the image of connection—that Chinese companies crave. My Chinese-language tutor, at first aghast about how much we were getting paid, put it this way: “Having foreigners in nice suits gives the company face.”
Six of us met at the Beijing airport, where Jake briefed us on the details. We were supposedly representing a California-based company that was building a facility in Dongying. Our responsibilities would include making daily trips to the construction site, attending a ribbon-cutting ceremony, and hobnobbing. During the ceremony, one of us would have to give a speech as the company’s director. That duty fell to my friend Ernie, who, in his late 30s, was the oldest of our group. His business cards had already been made."
"For the next few days, we sat in the office swatting flies and reading magazines, purportedly high-level employees of a U.S. company that, I later discovered, didn’t really exist."

Friday, July 17, 2026

You can now hire experts to make your unread books look "authentically" read (creative destruction and how the economy just keeps creating new types of occupations & professions)

See Those new service sector jobs from Tyler Cowen.

"It’s 85 years since Brian O’Nolan, better known as Flann O’Brien and Myles na gCopaleen, proposed a Book Handling Agency in The Irish Times.

On Sunday evening, Flann’s idea became reality. In a Berlin bar’s back room, Cabinet Magazine, a literary quarterly, assembled a crack team of white-coated literary experts to make your unread books look well-read – at moderate prices.

For €5 you could get an “essential” handling package including a “professional” spine-break for your book, “two commonplace page markers, 2 scholastic dog-ears; 4 underlined passages; 1 arbitrary yet discerning piece of marginalia; and 1 contextually appropriate piece of marginalia”.

The premier package added “mauling the edges” of the book with a drill and sand paper, thanks to the “vice-chiefs of abrasion (light, heavy)” as well as “one stain using cheap wine, coffee etc”, hand-applied by a “fluid dynamics specialist”.

There is a learning dimension as well:

“We learned that, to look authentic, coffee needs to be dropped at a different height than wine,” said Sina Najafi, editor-in-chief of Cabinet magazine, who organised the evening and took on the professional spine-breaking.

Here is the full story, via Benen Harrington."

Who wrote your potential love's online dating profile? (maybe they outsourced it to a professional who specializes in that) (2016)

New Profession Of "Wedding Hashtag Helper" Might Be An Example Of Creative Destruction At Work (2022)

Are dating coaches who help you with texting modern Cyrano de Bergeracs? (2023)

Do You Need a Fixer for Your Disney Vacation? Third-party companies tout advanced knowledge for private tours of complex amusement parks that can cost $1,000 and up (2023)

Parents Hire $4,000 Sorority Consultants to Help Daughters Dress and Impress During Rush (creative destruction and how the economy just keeps creating new types of occupations & professions) (2023)

Prompt engineers chat with generative-AI chatbots (creative destruction and how the economy just keeps creating new types of occupations & professions) (2023)

"Wedding content creators" curate the perfect social-media-ready images of the nuptials and celebration (creative destruction and how the economy just keeps creating new types of occupations & professions) (2023)

"Independent education consultants" help high school students and their parents navigate the competitive college-admissions process (creative destruction and how the economy just keeps creating new types of occupations & professions) (2024)

"Robot Wranglers" help lost and confused automatons (creative destruction and how the economy just keeps creating new types of occupations & professions) (2024)

Professional Bridesmaids (creative destruction and how the economy just keeps creating new types of occupations & professions) (2024)

Handbag authenticators (creative destruction and how the economy just keeps creating new types of occupations & professions) (2024)

App reviewers (creative destruction and how the economy just keeps creating new types of occupations & professions) (2025)

Video Clippers (creative destruction and how the economy just keeps creating new types of occupations & professions) (2025)

Creative destruction and mysterious new types of occupations & professions (2026)

Professional Hagglers (creative destruction and how the economy just keeps creating new types of occupations & professions) (2026)

Creative Destruction

See Creative Destruction by Richard Alm and W. Michael Cox. Excerpt:

"Joseph Schumpeter
(1883–1950) coined the seemingly paradoxical term “creative destruction,” and generations of economists have adopted it as a shorthand description of the free market’s messy way of delivering progress. In Capitalism, Socialism, and Democracy (1942), the Austrian economist wrote:
The opening up of new markets, foreign or domestic, and the organizational development from the craft shop to such concerns as U.S. Steel illustrate the same process of industrial mutation—if I may use that biological term—that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of Creative Destruction is the essential fact about capitalism. (p. 83)
Although Schumpeter devoted a mere six-page chapter to “The Process of Creative Destruction,” in which he described capitalism as “the perennial gale of creative destruction,” it has become the centerpiece for modern thinking on how economies evolve."

But also see this link which suggests that the idea goes back even before Schumpeter to other scholars: Creative Destruction in Economics: Nietzsche, Sombart, Schumpeter by Hugo Reinert and Erik S. Reinert.

"Abstract
This paper argues that the idea of ‘creative destruction’ enters the social sciences by way of Friedrich Nietzsche. The term itself is first used by German economist Werner Sombart, who openly acknowledges the influence of Nietzsche on his own economic theory. The roots of creative destruction are traced back to Indian philosophy, from where the idea entered the German literary and philosophical tradition. Understanding the origins and evolution of this key concept in evolutionary economics helps clarifying the contrasts between today’s standard mainstream economics and the Schumpeterian and evolutionary alternative."

Wednesday, July 15, 2026

Adam Smith on the value of self interest and the injustice of goverment trying to thwart it

See Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations (Cannan ed.), in 2 vols. [1776] from Online Library of Liberty. I wanted to post this because of my post on the decline in ESG from a few days ago. The idea was to emphasize that businesses don't have to try to improve society to make it better off and this invisible had philosophy does not apply only to international trade. What Smith says here sure sounds like the invisible hand.

From Volume 1.

"Every individual is continually exerting himself to find out the most advantageous employment for whatever capital he can command. It is his own advantage, indeed, and not that of the society, which he has in view. But the study of his own advantage naturally, or rather necessarily leads him to prefer that employment which is most advantageous to the society."

From Volume 2.

"It is thus that the private interests and passions of individuals naturally dispose them to turn their stock towards the employments which in ordinary cases are most advantageous to the society. But if from this natural preference they should turn too much of it towards those employments, the fall of profit in them and the rise of it in all others immediately dispose them to alter this faulty distribution. Without any intervention of law, therefore, the private interests and passions of men naturally lead them to divide and distribute the stock of every society, among all the different employments carried on in it, as nearly as possible in the proportion which is most agreeable to the interest of the whole society."

"To prohibit a great people, however, from making all that they can of every part of their own produce, or from employing their stock and industry in the way that they judge most advantageous to themselves, is a manifest violation of the most sacred rights of mankind."

See The State of ESG Investing: How Dire Is It?

"Investing based on environmental, social and corporate-governance factors has taken a hit over the past several years amid a backlash against so-called woke policies and weakness in ESG funds’ performance."

Tuesday, July 14, 2026

The Seasonally Adjusted CPI Was Down .422% in June

Here are the changes in the seasonally adjusted CPI for the six months ending in May:

Dec. 0.2978%

Jan. 0.1708%

Feb. 0.2670

March 0.8651%

April 0.6400%

May 0.4729

The last decline before June this year was June 2024 when it was -0.042%.

See Consumer Price Index for All Urban Consumers: All Items in U.S. City Average from FRED (Federal Reserve Economic Data) compiled by the Research Division at the Federal Reserve Bank of St. Louis for data on the seasonally adjusted CPI.

That site shows a graph but if you click on the Download button you will get the actual numbers in Microsoft Excel.

The Consumer Price Index for All Urban Consumers: All Items in U.S. City Average (CPIAUCSL) was 333.979 in May and 332.568 in June. Since 332.568/333.979 = 0.99578, that means it was down 0.422% since 1 - .99578 = 0.422. If we had that every month for 12 months the CPI would be down 4.95%.

It was 321.435 in June 2025. Since 332.568/321.435 = 1.0346, that means it was up 3.46% over the last 12 months.

The non-seasonally adjusted CPI was 333.952 in June and 322.561 in June 2025. That was up 3.53%. So pretty close to the seasonally adjusted CPI. This is well above the Fed's target of 2.0% (although they prefer to use the Personal Consumption Expenditures Price Index which was 4.1% higher in May 2026 than May 2025).

For more information see Consumer prices rose 3.5% annually in June, less than expected as energy prices eased by Jeff Cox of CNBC. Excerpt:

"Consumer prices posted their biggest decline in more than six years during June as a sharp swoon in energy prices provided at least temporary relief from this year’s inflation surge, the Bureau of Labor Statistics reported Tuesday.
The consumer price index, a broad measure of costs for goods and services across the U.S. economy, was lower than expected across the board. The CPI fell a seasonally adjusted 0.4% for the month, bringing the annual inflation rate down to 3.5%."
"Core inflation, which excludes food and energy, was flat on the month, putting the 12-month rate at 2.6%. The consensus forecast was for respective increases of 0.2% and 2.9%, following a 2.9% May level."

The article also discusses what types of products are going up in price and what is going down. There is a graph of the monthly year-over-year percent change in prices and core prices going back almost 4 years.

Related material:

Consumer Price Index for All Urban Consumers: All Items Less Food and Energy in U.S. City Average (CPILFESL) This is also from from FRED (Federal Reserve Economic Data), compiled by the Research Division at the Federal Reserve Bank of St. Louis. It has the seasonally adjusted core CPI.

Consumer Price Index Data from 1913 to 2025

Personal Consumption Expenditures Price Index

The Bureau of Labor Statistics makes seasonal adjustments. See Consumer Price Index Summary.

The table below has the annual inflation rate since 1914 in the columns labeled CPI %Ch. or CPI percentage change. It is from Consumer Price Index Data from 1913 to 2026 and is not seasonally adjusted. It is also the December to December change in the CPI. That site also looks at how the 12 month average for the CPI changed from one year to the next.

Year	CPI %Ch.	Year	CPI %Ch.	Year	CPI %Ch.	Year	CPI %Ch.
1914	1	1944	2.3	1974	12.3	2004	3.3
1915	2	1945	2.2	1975	6.9	2005	3.4
1916	12.6	1946	18.1	1976	4.9	2006	2.5
1917	18.1	1947	8.8	1977	6.7	2007	4.1
1918	20.4	1948	3	1978	9	2008	0.1
1919	14.5	1949	-2.1	1979	13.3	2009	2.7
1920	2.6	1950	5.9	1980	12.5	2010	1.5
1921	-10.8	1951	6	1981	8.9	2011	3
1922	-2.3	1952	0.8	1982	3.8	2012	1.7
1923	2.4	1953	0.7	1983	3.8	2013	1.5
1924	0	1954	-0.7	1984	3.9	2014	0.8
1925	3.5	1955	0.4	1985	3.8	2015	0.7
1926	-1.1	1956	3	1986	1.1	2016	2.1
1927	-2.3	1957	2.9	1987	4.4	2017	2.1
1928	-1.2	1958	1.8	1988	4.4	2018	1.9
1929	0.6	1959	1.7	1989	4.6	2019	2.3
1930	-6.4	1960	1.4	1990	6.1	2020	1.4
1931	-9.3	1961	0.7	1991	3.1	2021	7
1932	-10.3	1962	1.3	1992	2.9	2022	6.5
1933	0.8	1963	1.6	1993	2.7	2023	3.4
1934	1.5	1964	1	1994	2.7	2024	2.9
1935	3	1965	1.9	1995	2.5	2025	2.7
1936	1.4	1966	3.5	1996	3.3
1937	2.9	1967	3	1997	1.7
1938	-2.8	1968	4.7	1998	1.6
1939	0	1969	6.2	1999	2.7
1940	0.7	1970	5.6	2000	3.4
1941	9.9	1971	3.3	2001	1.6
1942	9	1972	3.4	2002	2.4
1943	3	1973	8.7	2003	1.9

Here is a timeline graph of this data: