The long-term, wealth-building effect of homeownership is often less than that of renting and investing in the diversified market

See Homeownership and Wealth: Why Policymakers Should Stop Subsidizing Risk by Norbert Michel and Jerome Famularo of The Cato Institute. Excerpts:

"Whether buying or renting and investing is a better strategy for long-term net worth is dependent on many factors. In particular, it depends on the price-to-rent ratio (the ratio of a home’s selling price to its renting price), future house price appreciation, future rent inflation, future market returns, and mortgage rates.

In general, renting is almost always a better decision for short-term residency (under 10 years) due to the lack of closing costs or high-interest payments that are only associated with buying. Still, a longtime homeowner may enjoy higher net worth relative to renting and investing, especially if house price appreciation and rental inflation are both high relative to market returns. If, however, market returns are high and house price appreciation and rental inflation are low, renting and investing would likely lead to higher net worth even for longer-term residencies.

The New York Times has built a great tool for estimating whether buying or renting is a better deal, depending on various adjustable parameters. Table 1 uses the latest data from Zillow to show the amount of time it would take for buying to pay off versus renting across several market scenarios, using median home price and rent for the US average, San Jose, and New Orleans, respectively. As these results demonstrate, depending on the location and combination of market returns, rent inflation, house price appreciation, and mortgage rates, it could take as little as three years for buying to pay off versus renting—or it could take more than 40 years.

 

It is, of course, impossible to know the future trajectory of these measures, thus the decision poses a financial risk even before considering an individual’s future ability to earn income.

As far as the decision to rent or buy is concerned, other factors are worth considering besides net worth. Renting has the advantage of flexibility. Rental contracts are relatively easy to initiate or break. Investments in the market or savings accounts are quite liquid, particularly compared to selling a house. Taking out a home mortgage also effectively requires many people to invest everything they have in a single, undiversified asset. Moreover, the value of that asset, a home, is often subject to change based on local characteristics. For anyone with volatile or slow-growing income, taking on a home mortgage in this manner prevents the homeowner from diversifying their investments, thus magnifying their financial risk.

Of course, many benefits come with owning a home. For instance, the resident homeowner has much more ability to customize their home to their liking. Many people like the idea of certainty, hoping that buying will allow them to live in the same place for many years. These factors are all subjective though, and potential buyers should carefully weigh them against their (also subjective) financial risks."

Related posts:

Home-Buying Math No Longer Adds Up (2024)

There’s Never Been a Worse Time to Buy Instead of Rent: It is now 52% more expensive to buy a home than to rent one because of climbing mortgage rates (2023)

Are things getting better for apartment renters? (2023)

Apartment Rents Fall as Crush of New Supply Hits Market (2023)

First Annual Drop in Rents Since Pandemic Began, Redfin Says (2023)

The Law of Supply Seems to Be Working in the San Antonio Apartment Market (2023)

Home sale prices, apartment demand and the price of subsitutes (2022)

Increased Supply Is Holding Down Rent Increases (2018) 

Rents are relatively low in San Antonio (2018)

People leaving costly cities while rent falls in other cities due to rising supply (2016)

More housing means lower prices

See Why Lower Mortgage Rates Aren’t Enough to Make Homes Affordable, in Charts: Many hopeful buyers need more than lower rates to afford a house by Veronica Dagher of The WSJ. Excerpts:

"Homeowners with low mortgage rates and a lot of equity feel little pressure to sell, which is keeping inventory low in some regions. Rising costs for home insurance and property taxes in many places are making matters worse."

"The most affordable starter homes, especially in the tight markets of the Northeast and Midwest, still often see intense bidding and rapid price appreciation, said Hannah Jones, senior analyst at Realtor.com, which is operated by News Corp, parent of The Wall Street Journal.

In New York, home prices have more than doubled over the past nine years, reflecting the state’s chronic shortage of inventory. By contrast, prices have climbed about 33% in Texas over the same period, thanks in part to more building, she said."

So where they are not building much, prices are up more than 100% in the past 9 years. Where they are building it is only up 33%, a difference of at least 67 percentage points.

The CPI was 34.5% higher in Sept. 2025 than it was in Sept. 2016. So Texas home prices are just about unchanged after inflation is taken into account. But in New York, home prices are up at least three times as much as the CPI. 

How much would you pay someone to wait in line to get "free" Shakespeare tickets for you?

See New York, Where a 16-Hour Line for Shakespeare Makes Perfect Sense: This city loves a line, but at 2:30 a.m.? It could only be one thing by Charles Passy and Jacob Passy of The WSJ. 

We say in economics that there is no free lunch. So there are no free Shakespeare tickets. People pay a pretty big cost in terms of time to get them and sometimes wait in line and come up empty. Or you can pay someone to wait and save time, which is money. 

Excerpts

"In a city (NY) now famous for its lines, the one for the Public Theater’s free Shakespeare in the Park is as storied as the open-air shows themselves."

"Kelly Gregor arrived with her husband at 2:30 a.m. on a recent weekday. The 29-year-old graduate student heard that scoring tickets was tough. “I don’t want to gamble,” she said.

It was eerily dark when they took their spot on the western edge of the park, which is closed until 6 a.m. Within a few hours, a couple hundred others had joined them, spread out on blankets and camping chairs.

Gregor brought chocolate and popcorn. She even planned to get some sleep, but was thwarted by a late-summer chill. Her husband eventually went home to grab extra clothing. Others in the crowd had hot soup from a local restaurant delivered."

"Ryan-Young has made Shakespeare in the Park a tradition. This year that required more tenacity. His first two attempts to secure tickets failed; he got to the site too late. The third try was successful, but only after he and his college-student daughter woke up at 1:30 a.m."

"Every summer, Same Ole Line Dudes, which bills itself as “New York’s Premier Team of Professional Line Sitters,” sees an influx of requests from would-be theatergoers. This year, requests for Shakespeare in the Park doubled, said founder Robert Samuel.

The company charges $25 an hour for its services, with a two-hour minimum, plus a $15 fee for queuing before 7 a.m. One group of Mexican tourists shelled out $795 for six tickets, delivered to their hotel." 

Related posts:

"It’s almost like you’re paying to get out of jail" (paying for a service that lets you avoid TSA lines at the airport) (2016)

Students at Cornell University can use an app to pay their peers to drop out of certain classes to obtain an open seat themselves (2022) 

Want to make $60 an hour? Stand in line for a lobbyist, while its still legal (2007) 

I asked the AI program Claude to write a dialogue between Beethoven and Shakespeare where they discuss the character Coriolanus and Beethoven's music written for Heinrich Joseph von Collin's 1804 tragedy Coriolan

A Meeting of Masters

Setting: A quiet study in Vienna, 1808. Beethoven sits at his pianoforte, manuscript pages scattered about. Shakespeare appears as if conjured from time itself.

---

Shakespeare: Master Beethoven, I hear you've been keeping company with my Coriolanus—or rather, a German cousin of him.

Beethoven: (turning, startled, then recovering) Herr Shakespeare! Yes, though not your version directly. Collin's tragedy—it premiered here in Vienna four years past. I composed an overture for its revival. The character... he seized my imagination completely.

Shakespeare: Ah, so you found something in that proud, impossible man? What drew you to him?

Beethoven: His defiance! His refusal to bend, even when bending would save him. (strikes a chord) There is something tragic and noble in a man who cannot compromise his nature, even for survival. Is this not what you intended?

Shakespeare: I intended a man whose virtues became his destruction. Pride, martial excellence, contempt for the common voice—all admirable in their place, yet fatal in combination. But tell me, how does one capture such contradictions in music without words?

Beethoven: (growing animated) The overture begins with force—unison chords, brutal and martial. This is Coriolanus the warrior, unyielding. But then... (plays a softer passage) here enters tenderness, pleading. His mother Volumnia, perhaps? Or his own suppressed humanity?

Shakespeare: His mother! Yes, she was his undoing. In my play, she kneels before him with his wife and child, and that proud heart finally breaks. No enemy army could defeat him, but a mother's tears...

Beethoven: Exactly! The conflict between these themes—the fierce and the tender—this struggle repeats throughout. Neither can triumph completely while both live. The music grows more desperate, more fragmented...

Shakespeare: As the man himself fragments. He cannot be both Roman hero and dutiful son, both conqueror and citizen. The world demands he choose, but his nature will not allow it.

Beethoven: (nodding vigorously) And so the ending—I wrote it to suggest his death, but not a triumphant death. The main theme disintegrates, grows quieter, slower... it simply exhausts itself and fades away.

Shakespeare: A whimper after all that roaring? How fitting. Though I gave him defiant words at his end—"Cut me to pieces, Volsces men!"—perhaps the truth is closer to your version. When a man betrays everything he believed himself to be, what remains?

Beethoven: Nothing. Silence. (pause) But there is grandeur even in that dissolution, no? The tragedy is not that he was wrong, but that the world could not accommodate what he was right about.

Shakespeare: You defend him more than I might! But then, you composers are romantics. You see a hero where I saw a cautionary tale—a warning about inflexibility, about scorning those you need, about letting pride master judgment.

Beethoven: (irritably) Perhaps I am no diplomat myself. Perhaps I understand what it means to refuse to play the game, to make my art as I see fit regardless of what patrons or public demand!

Shakespeare: (smiling) Ah, now I see why you chose him. You are composing your own portrait, Herr Beethoven. But take care—I gave Coriolanus no happy ending.

Beethoven: Neither did I. But for twenty minutes, his struggle lives in sound—pure, wordless, honest. Is that not immortality of a kind?

Shakespeare: (extending his hand) Your kind of immortality, perhaps. Mine required rather more words. But yes—we both understood that some souls are too large for the cages history builds for them.

Beethoven: And some stories are too powerful to tell only once.

---

Shakespeare fades back into time. Beethoven returns to his manuscript, adding a few fierce strokes of the pen.

Related posts:

A ChatGPT story: What if Jane Austen and Adam Smith met to discuss his book The Theory of Moral Sentiments? (2025) 

A dialogue between Joseph Campbell and Joseph Schumpeter where they discuss heroes, entrepreneurs and creative destruction from ChatGPT (2025) 

Two article about Generation Z's attitudes towards work

See Is Gen Z Unemployable? Hiring managers prize achievement, learning and work. Today’s youth value pleasure and individuality by Suzy Welch. She is a professor of management at New York University. Excerpts:

"A mere 2% of Generation Z members hold the values that companies want most in new hires, namely achievement, learning and an unbridled desire to work."

"most students confuse values with virtues. Values are choices about how we want to live and work, while virtues are qualities that everyone generally agrees are good, like kindness and integrity."

"Scholars have identified more than a dozen values, each existing on a continuum of intensity, of which family and financial security are only two."

"In 2022 I assembled a team of data scientists, engineers, researchers and psychometricians to help me formulate a scientifically validated, behaviorally based assessment tool called the Values Bridge."

What were Gen Z's values?

"In first place is eudemonia, a Greek term my inventory uses to encompass the desire for self-care and personal pleasure. Next comes voice, the value that reflects the priority a person places on expressing authentic individuality. Third, non sibi, the Latin term meaning “not for oneself,” the desire to help people. Fourth is affluence, exactly as it sounds, and fifth, “beholderism,” a desire for things—including yourself—to be beautiful."

What about employers?

"Achievement came in first" [that was] "11th for Generation Z; 61% wish they had less of it in their lives."

"Next for the hiring managers was scope, which reflects the desire for learning, action and stimulation. That ranks 10th for Gen Z.

Third for hiring managers was “workcentrism,” the desire to work for work’s sake. That’s ninth for Gen Z."

"how many Generation Z respondents . . . identified achievement, scope and workcentrism in their top five values. Only 154, or 2.04%, did so."

See also Layoffs Aren’t Shaking Gen Z’s Commitment to Work-Life Balance: Recent layoffs have reinforced beliefs among some younger professionals that loyalty to a company won’t be returned by Oyin Adedoyin and Ray A. Smith of The WSJ. Excerpts:

"younger professionals are still giving priority to work-life balance and remain more detached from their employers than older workers"

"sweeping layoffs at companies in recent weeks have reinforced the belief that loyalty to an employer won’t be reciprocated."

"“Even though the labor market is tougher, people are still feeling disconnected from their employers,” said Jim Harter, chief scientist of workplace management and well-being at Gallup." [maybe this is not a surprise given the big difference in values mentioned in the first article]

"Unlike older generations, who tend to work harder to make themselves seem indispensable in a weakening job market, younger professionals don’t seem to fear that their insistence on work-life balance will cost them their jobs"

"More young professionals choose work-life balance over salary as the most important attribute they considered when thinking about starting a full-time job"

"The shifting priorities are showing up in shrinking work hours. Americans worked an average of 42.9 hours a week last year, down from 44.1 hours in 2019, according to a Gallup survey. Those younger than 35 led the decline, working an average of nearly two hours less a week, while older employees reduced their workweek by just under one hour." 

Are Stock Analysts Useless?

By Spencer Jakab of The WSJ. Excerpts:

"The percentage of “sell” ratings rose briefly after the legal spotlight shone on Wall Street’s seers in the early aughts.

It’s back down to 5%, which is worse than it sounds. While stock prices broadly rise over time, only a minority of them produce those gains. Most don’t beat cash in the bank."

"The reason many professional investors keep relying on analysts who are chummy with executives is that it’s perceived as an edge."

"the nuggets they glean in conversation with executives, or the private management meetings those analysts set up for clients, don’t benefit individual investors."

"Take a post by Bespoke Investment, a little over two years ago, on the nine large U.S. stocks that Wall Street analysts recommended unanimously. Buying one share of each company (including one that underwent a merger) would have returned 17%. That’s just a third as much as an S&P 500 index fund through yesterday morning."

Related posts:

Want to Beat the Stock Market? Avoid the Cost of ‘Being Human’: Professional fund managers labor under handicaps that individual investors don’t face. Make sure you manage your portfolio differently than they do (2023) 

Keynes As An Investor (2012)

From 1720 to Tesla, FOMO Never Sleeps: The South Sea bubble is the classic story of an investing mania. Are investors today any wiser? (2020)

Beat the Market by Picking the Market (2022)

Interesting Theory on Stock Market Fluctuations (2007)

Ignorance Really Is Bliss When It Comes to Investing (2023)

The Making of the World’s Greatest Investor (2020) 

Celebrating Russian Novelist Fyodor Dostoevsky

Nov. 11 is his birthday. One of his famous books is Crime and Punishment.

Below are some passages that relate to economics and one sounds like the invisible hand.  All of the passages can be found at https://www.bartleby.com/lit-hub/crime-and-punishment/.

From Part I, Chapter 2:

"But Mr. Lebeziatnikov who keeps up with modern ideas explained the other day that compassion is forbidden nowadays by science itself, and that that's what is done now in England, where there is political economy." (economics used to be called political economy)"

From Part II, Chapter 5:

"if I were told, 'love thy neighbour,' what came of it?" Pyotr Petrovitch went on, perhaps with excessive haste. "It came to my tearing my coat in half to share with my neighbour and we both were left half naked. As a Russian proverb has it, 'Catch several hares and you won't catch one.' Science now tells us, love yourself before all men, for everything in the world rests on self-interest. You love yourself and manage your own affairs properly and your coat remains whole. Economic truth adds that the better private affairs are organised in society--the more whole coats, so to say—the firmer are its foundations and the better is the common welfare organised too. Therefore, in acquiring wealth solely and exclusively for myself, I am acquiring, so to speak, for all, and helping to bring to pass my neighbour's getting a little more than a torn coat; and that not from private, personal liberality, but as a consequence of the general advance." The idea is simple, but unhappily it has been a long time reaching us, being hindered by idealism and sentimentality. And yet it would seem to want very little wit to perceive it."

From Part III, Chapter 5:

"“Not quite, that’s true,” Razumihin agreed at once, getting warm and hurried as usual. “Listen, Rodion, and tell us your opinion, I want to hear it. I was fighting tooth and nail with them and wanted you to help me. I told them you were coming.… It began with the socialist doctrine. You know their doctrine; crime is a protest against the abnormality of the social organisation and nothing more, and nothing more; no other causes admitted!…”

“You are wrong there,” cried Porfiry Petrovitch; he was noticeably animated and kept laughing as he looked at Razumihin, which made him more excited than ever.

“Nothing is admitted,” Razumihin interrupted with heat. “I am not wrong. I’ll show you their pamphlets. Everything with them is ‘the influence of environment,’ and nothing else. Their favourite phrase! From which it follows that, if society is normally organised, all crime will cease at once, since there will be nothing to protest against and all men will become righteous in one instant. Human nature is not taken into account, it is excluded, it’s not supposed to exist! They don’t recognise that humanity, developing by a historical living process, will become at last a normal society, but they believe that a social system that has come out of some mathematical brain is going to organise all humanity at once and make it just and sinless in an instant, quicker than any living process! That’s why they instinctively dislike history, ‘nothing but ugliness and stupidity in it,’ and they explain it all as stupidity! That’s why they so dislike the living process of life; they don’t and a living soul! The living soul demands life, the soul won’t obey the rules of mechanics, the soul is an object of suspicion, the soul is retrograde! But what they want though it smells of death and can be made of india-rubber, at least is not alive, has no will, is servile and won’t revolt! And it comes in the end to their reducing everything to the building of walls and the planning of rooms and passages in a phalanstery! The phalanstery is ready, indeed, but your human nature is not ready for the phalanstery—it wants life, it hasn’t completed its vital process, it’s too soon for the graveyard! You can’t skip over nature by logic. Logic presupposes three possibilities, but there are millions! Cut away a million, and reduce it all to the question of comfort! That’s the easiest solution of the problem! It’s seductively clear and you mustn’t think about it. That’s the great thing, you mustn’t think! The whole secret of life in two pages of print!”

“Now he is off, beating the drum! Catch hold of him, do!” laughed Porfiry. “Can you imagine,” he turned to Raskolnikov, “six people holding forth like that last night, in one room, with punch as a preliminary! No, brother, you are wrong, environment accounts for a great deal in crime; I can assure you of that.”

“Oh, I know it does, but just tell me: a man of forty violates a child of ten; was it environment drove him to it?”

“Well, strictly speaking, it did,” Porfiry observed with noteworthy gravity; “a crime of that nature may be very well ascribed to the influence of environment.”"

To see what phalanstery is go to Phalanstère at Wikipedia. Excerpt:

"A phalanstère (or phalanstery) was a type of building designed for a self-contained utopian community, ideally consisting of 500–2,000 people working together for mutual benefit, and developed in the early 19th century by Charles Fourier. Fourier chose the name by combining the French word phalange (phalanx, an emblematic military unit in ancient Greece), with the word monastère (monastery)."

The AI Revolution Will Bring Prosperity

The growth of industry disrupted old economic patterns but produced undreamed-of wealth

By Phil Gramm and Michael Solon. Excerpts:

"From the colossal changes wrought by the Industrial Revolution to the Digital Revolution of the last quarter-century, improvements in technology have created an array of jobs that far exceeded—in quantity and quality—the ones eliminated, elevating standards of living."

"the Industrial Revolution in the U.K. unleashed a greater concentration of material blessings than ordinary people had ever experienced. From 1840 to 1900 real wages doubled, and the average lifespan increased by 22%, from roughly 41 years to 50. The population doubled, and employment rose by 80%."

"In America . . . From 1870 to 1900 real gross domestic product tripled, the population and labor force roughly doubled, and output in manufacturing grew sixfold. Real per capita income rose by 110% between 1865 and 1910, while real wages of manufacturing workers increased an estimated 173%. Life expectancy rose by a quarter as inflation-adjusted costs of food, clothing and shelter dropped by roughly 50%."

"During the Digital Revolution of the last quarter-century, U.S. real GDP rose by 66%."

"Since 2000 on average five million Americans have either been laid off or quit their job every month, but the economy has created 5.1 million better-paying jobs a month. This creative destruction isn’t new. In 1810, 81% of Americans worked in agriculture; today only 1.2% do. In 1953, 32% of Americans worked in factories. As real industrial production quadrupled, the share of the labor force in manufacturing declined to 7.8% in 2025."

"In America, mechanization, economies of scale and mass marketing gutted local competitors by providing lower prices and higher-quality products."

"trade adjustment assistance, extended unemployment and our welfare system were no doubt well-intended, they have impeded workers’ transition to new jobs."

"Europe makes it hard to lay people off, which constrains the ability to create jobs. In China, most industrial subsidies go to noncompetitive industries, not to the potential winners of the future."  

Related posts:

ChatGPT Should Make Retailers Nervous: Retail companies risk losing control of the online shopping experience (2025) 

The Coasean Singularity? Demand, Supply, and Market Design with AI Agents (2025) 

AI startups are literally paying people to fold their laundry (or perform similar chores) (2025)

There Is Now Clearer Evidence AI Is Wrecking Young Americans’ Job Prospects (but the news is not all bad): Young workers face rising AI competition in fields like software development, but some also benefit from AI as a helper, new research shows (2025)

AI Is Forcing the Return of the In-Person Job Interview: More companies are returning to face-to-face meetings to counter cheating by candidates—and more ominous digital threats (2025) 

AI’s Overlooked $97 Billion Contribution to the Economy: The AI ‘dividend’ may not be evident yet in estimates of gross domestic product but it’s making life better and more productive (2025) 

AI Is Wrecking an Already Fragile Job Market for College Graduates (is the problem structural Unemployment & the case of a skills mismatch?) Companies have long leaned on entry-level workers to do grunt work that doubles as on-the-job training. Now ChatGPT and other bots can do many of those chores (2025) 

No, AI Robots Won’t Take All Our Jobs: Instead, they will boost productivity, lower prices and spur the evolution of the labor market (2025) 

IBM CEO Says AI Has Replaced Hundreds of Workers but Created New Programming, Sales Jobs: The tech company promises higher total employment as it reinvests resources toward roles like software development (2025)

Technological Disruption in the Labor Market (2025)

Why AI Might Not Take All Our Jobs—if We Act Quickly (2025)

Some good news on productivity (2025) (AI is mentioned)

Some economics of A.I. (2025) 

The AI-Generated Population Is Here, and They’re Ready to Work (2024)

Robots writing science fiction (2024)

Will technology cost artists their job? (2023)

“Why did the human stare at the glass of orange juice?” “They were trying to concentrate.” (2023) (Partly about AI being used to tell jokes)

The $900,000 AI Job Is Here (2023) 

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

Are robots writing fake product reviews? (2022)

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

An AI Breaks the Writing Barrier (2020) 

What Econ 101 Can Teach Us About Artificial Intelligence: Here's why advancing technology often leads to more jobs for humans, not fewer (2017)

ChatGPT Should Make Retailers Nervous

Retail companies risk losing control of the online shopping experience

By Jinjoo Lee of The WSJ. Excerpts:

"ChatGPT’s Instant Checkout feature allows shoppers to go from asking something like “find me the lightest strollers under $300,” browse, and proceed to checkout without leaving the chat. OpenAI has said that merchants pay it a small fee on completed purchases. The product results that come out of ChatGPT inquiries will be “organic and unsponsored,” OpenAI says.

The retailers’ reasoning is pretty straightforward: If people are going to chatbots for shopping recommendations, it only makes sense to be there and get the first-mover advantage. “You want to be closest to the place of discovery,” notes Oliver Chen, analyst at TD Cowen."

"Roughly 38% of U.S. consumers surveyed by Adobe earlier this year said they have used generative AI for online shopping"

"letting shoppers skip retailers’ websites and apps could come at a cost. Airline companies, for example, haven’t had the best relationship with third-party booking sites. Some have pulled their fare information from those websites to avoid paying a fee and to improve sales of add-on products such as extra legroom and frequent-flier points through their own websites."

"easy comparisons and direct checkout could hurt retailers’ customer loyalty and take away add-on sale opportunities. It could also dent retailers’ important ad revenue. Of the roughly $59 billion that companies are expected to spend on U.S. retailers’ ad business this year, more than 60% is tied to search placements on those retailers’ sites and apps, according to a report from Emarketer. “If discovery moves upstream to universal AI assistants, ad budgets could follow,” according to the firm’s report. Losing ad revenue would be bad news for retailers, especially Walmart"

"While OpenAI doesn’t run ads yet, it has been looking for ways to monetize the platform"

"Amazon . . . has reportedly blocked GenAI platforms from scraping information from its website"

"Amazon is working on a handful of its own shopping AI features"

"For retailers, the best-case scenario might be a future where consumers use universal AI platforms such as ChatGPT only for certain types of purchases. Perhaps these are purchases that are higher budget or require more complex decisions, such as sofas or washing machines."

"Consumers might use universal chatbots to shop for a wide range of things—from household staples to season-appropriate clothing—without clicking on a single link to a retailer’s website."  

Related posts:

The Coasean Singularity? Demand, Supply, and Market Design with AI Agents (2025) 

AI startups are literally paying people to fold their laundry (or perform similar chores) (2025)

There Is Now Clearer Evidence AI Is Wrecking Young Americans’ Job Prospects (but the news is not all bad): Young workers face rising AI competition in fields like software development, but some also benefit from AI as a helper, new research shows (2025)

AI Is Forcing the Return of the In-Person Job Interview: More companies are returning to face-to-face meetings to counter cheating by candidates—and more ominous digital threats (2025) 

AI’s Overlooked $97 Billion Contribution to the Economy: The AI ‘dividend’ may not be evident yet in estimates of gross domestic product but it’s making life better and more productive (2025) 

AI Is Wrecking an Already Fragile Job Market for College Graduates (is the problem structural Unemployment & the case of a skills mismatch?) Companies have long leaned on entry-level workers to do grunt work that doubles as on-the-job training. Now ChatGPT and other bots can do many of those chores (2025) 

No, AI Robots Won’t Take All Our Jobs: Instead, they will boost productivity, lower prices and spur the evolution of the labor market (2025) 

IBM CEO Says AI Has Replaced Hundreds of Workers but Created New Programming, Sales Jobs: The tech company promises higher total employment as it reinvests resources toward roles like software development (2025)

Technological Disruption in the Labor Market (2025)

Why AI Might Not Take All Our Jobs—if We Act Quickly (2025)

Some good news on productivity (2025) (AI is mentioned)

Some economics of A.I. (2025) 

The AI-Generated Population Is Here, and They’re Ready to Work (2024)

Robots writing science fiction (2024)

Will technology cost artists their job? (2023)

“Why did the human stare at the glass of orange juice?” “They were trying to concentrate.” (2023) (Partly about AI being used to tell jokes)

The $900,000 AI Job Is Here (2023) 

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

Are robots writing fake product reviews? (2022)

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

An AI Breaks the Writing Barrier (2020) 

What Econ 101 Can Teach Us About Artificial Intelligence: Here's why advancing technology often leads to more jobs for humans, not fewer (2017)

The Economics of Culture

People from cultures that emphasize productive habits tend to advance. The reverse is also true

By Roland Fryer. He is a Harvard economics professor. Excerpts:

[Economist Thomas] "Sowell has argued that both human capital and culture drive mobility—more so, in his view, than discrimination or external barriers. Groups that develop productivity-enhancing traits such as skills, an orientation toward education and work, and thriftiness tend to advance."

"culture and economics are woven tightly together."

"Economists define it [culture] as the bundle of beliefs and values that ethnic, religious and social groups pass down from generation to generation."

"Culture operates like capital, potentially influencing the productivity and progress of groups."

"Cultural differences across racial and ethnic groups are unmistakable."

"A 2017 USA Today analysis found that the top show for white audiences, “NCIS,” didn’t even make the top five for black, Hispanic or Asian viewers. Meanwhile, the most-watched show among African-Americans, “Empire,” ranked in fifth place for Hispanics and didn’t make the top five for whites."

"Mr. Sowell argued in his 1994 book “Race and Culture: A World View,” culture can sometimes discourage behaviors that lead to progress—devaluing education, stigmatizing work or glorifying reckless behavior. That idea echoes the long-debated “culture of poverty” theory, which holds that poverty can perpetuate itself through self-defeating norms and expectations."

"In the 1960s, naming differences between black and white parents were modest. Even in segregated neighborhoods, black families chose names similar to those of whites. But in the early 1970s, a profound shift swept through black America, especially in racially isolated areas. In the 1960s, the median black girl living in a segregated black neighborhood received a name that was only twice as common among black girls as among white girls. In the 1970s, that number rose to 20 times. A quarter of black families, mostly those in integrated neighborhoods, moved in the opposite direction, choosing names more similar to whites’ names."

"We found no compelling evidence that having a distinctively black name harmed a child’s prospects once background factors were taken into account."

"culture . . . shapes the formation of human capital—the skills, aspirations and habits that drive success. Mr. Sowell emphasized this repeatedly: The same innate ability can produce different outcomes depending on the norms that surround it."

[In] "a 2015 study by Leonardo Bursztyn and Robert Jensen . . . they offered free SAT-prep courses. On some sign-up forms, they promised to keep students’ decisions completely private; on others, they said the rest of the class would know who signed up. In non-honors classes, students were 11 percentage points less likely to sign up for SAT prep if their classmates would know. For students taking both honors and non-honors courses, their reaction depended on which set of peers would find out; visibility increased sign-ups in honors classes but decreased it in other classes."

"The experiment revealed a “social tax” on learning: Culture didn’t change the real payoff to education, but it changed students’ willingness to claim it."

Related posts:

Differences in national health care outcomes had more to do with culture, environment, social policy and individual choice than with the cost or level of health care (2023)

Authors of the book How the World Became Rich have posted teaching materials online (2022) 

"A society’s past and its institutions and culture play a key role in shaping how it may – or may not – develop"

Germany, Muslims, Christian Values And Technical Expertise: How Economics Is Connected To Everything (2010)

"Germany's attempt to create a multi-cultural society has failed completely, Chancellor Angela Merkel said at the weekend, calling on the country's immigrants to learn German and adopt Christian values"

More risk-averse and less entrepreneurial people grew up listening to stories wherein competitions and challenges are more likely to be harmful than beneficial (2024)