Sunday, November 08, 2026

An interesting new book just came out called The Grim Old Days: An Introduction to the Preindustrial Past

It is by Chelsea Follett. Click here to go to the Amazon link. Here is the summary:

"Trying to imagine the preindustrial past might conjure the image of an idyllic country village with pristine air and residents merrily dancing around maypoles. The healthy, peaceful, and prosperous people in this fantasy of pastoral bliss do not realize that their contented, leisurely lives will soon be disrupted by the story’s villain: the dark smokestacks of the Industrial Revolution, what the poet William Blake called “satanic mills.” Yet such rose-colored views of history bear no resemblance to reality.

The preindustrial world was far more gruesome than modern minds can fathom—marked by unthinkable poverty, drudgery, cruelty, and pain. From child abuse and famine-induced cannibalism to bloodletting and streets that doubled as open sewers, ordinary existence was fraught with horrors. The Grim Old Days indulges the reader’s morbid curiosity about everyday history with firsthand accounts and shocking facts, meticulously researched and laid out in grotesque detail. The book strips away romantic illusions to confront the harsh reality of preindustrial life—one that most people today would not wish upon their worst enemies."

Related posts:

The price of light has fallen dramatically since 1800 (2026) (it is down 99.9% since 1700)

If 2025 was not the best year in human history it was still very good (2025) 

Even This Year (2024) Is the Best Time Ever to Be Alive (2025)

We are privileged to live in an age of medical miracles that increase human welfare (as the share of the world’s people living in extreme poverty has fallen) (2023)

Why 536 was ‘the worst year to be alive’ (2020)

The World Is Getting Quietly, Relentlessly Better (2019)

This Has Been the Best Year Ever (2019)  

Why 2017 Was the Best Year in Human History (2018)

The short history of global living conditions and why it matters that we know it (2018)

How Much Has Life Expectancy Improved?  (2018)

Some Good Economic News (2013)

Friday, November 06, 2026

The % of 25-54 year-olds employed was 80.7% in October after being 80.7% in Sept; Average Weekly Hours of All Employees held steady at 34.4

One weakness of the unemployment rate is that if people drop out of the labor force they cannot be counted as an unemployed person and the unemployment rate goes down. They are no longer actively seeking work and it might be because they are discouraged workers. The lower unemployment rate can be misleading in this case. People dropping out of the labor force might indicate a weak labor market.

We could look at the employment to population ratio instead, since that includes those not in the labor force. But that includes everyone over 16 and that means that senior citizens are in the group but many of them have retired. The more that retire, the lower this ratio would be and that might be misleading. It would not necessarily mean the labor market is weak.

But we have this ratio for people age 25-54 (which also eliminates many college age people who might not be looking for work).

It was 80.6% in Jan. 2020 and 69.6% in April 2020. It was 80.8% in May of 2026.  Click here to see the BLS data. Here is what it was for each of the last 4 years

2022) 79.883% 
2023) 80.683%
2024) 80.717%
2025) 80.600% (just an 11 month average due to no data for October instead of 12)
 
There have been only 5 months since April 2001 when the % of 25-54 year-olds employed was as high as 80.9%. The high so far in 2026 is 80.8%, reached in Jan. & June. But it fell to 80.2% in July. We have now had 46 straight months with at least 80%. The only longer streak was 65 months from 1996-2001. From Feb. 2008 to July 2019 we had 138 straight months with it under 80%. 

The unemployment rate was 4.1% in Oct. after being 4.2% in Sept. Click here to go to that data. Here is what it was for each of the last 4 years. 

2022) 3.6%
2023) 3.6%
2024) 4.0%
2025) 4.3%
 
Labor Force participation rose to 61.913% from 61.789%. Here is what it was for each of the last 4 years 
 
2022) 62.2%
2023) 62.6%
2024) 62.6%
2025) 62.4%
 
The % of the adult population employed rose to 59.349% from 59.209% (that is people 16 years old and older). Here is what it was for each of the last 4 years 
 
2022) 60.0%
2023) 60.3%
2024) 60.1%
2025) 59.7%

Here is the timeline graph of the percentage of 25-54 year olds employed since 2016.
 
 
 Now since 1948. 
 
 
Now hours worked. This comes from the St. Louis FED. See Average Weekly Hours of All Employees, Total Private. It was 34.4 in both Oct. and Sept. Shaded areas indicate U.S. recessions.  
 
 
 
Related posts: 

"The reason for the discrepancy is that there are two surveys. The establishment survey is used for the Labor Department's monthly jobs report. They contact businesses for this survey. The household survey is used to put together the unemployment rate. The Bureau of Labor Statistics contacts households for this one."

Also see Comparing employment from the BLS household and payroll surveys from the BLS.

Also see U.S. economy added 165,000 jobs in October, way more than expected; unemployment rate slips to 4.1% by Jeff Cox of CNBC.

Thursday, November 05, 2026

Relaxed academic standards worsen deficits in human capital accumulation

 See The unintended consequences of academic leniency from Tyler Cowen.

"Education is widely recognized as the primary driver of human capital accumulation. However, policies designed to promote educational attainment often overlook students’ endogenous responses. This paper provides empirical evidence of the causal impact of relaxed academic standards on student effort and achievement. We find that academic leniency results in mechanical GPA increases, but significant reductions in effort among lower ability students based on lower attendance and lower numerical grades. These heterogeneous effects compound and exacerbate gaps in engagement and achievement throughout high school, ultimately worsening deficits in human capital accumulation as measured by ACT scores.

That is from a newly published paper, in AEJ: Economic Policy, by A. Brooks Bowden, Viviana Rodriguez, and Zach Weingarten."

Related posts:

Does grade inflation cost students $213,872 in lifetime earnings? (2026)

Being assigned a higher average grade inflating teacher reduces a student's future test scores, the likelihood of graduating from high school, college enrollment, and ultimately earnings 

Cognitive Endurance as Human Capital (2022)

the experience of effortful thinking increases the ability to accumulate traditional human capital & an additional year of schooling improves cognitive endurance, but only in higher-quality schools 

Would you pay someone to make you work hard? (2022)

At the Manuscript Writing Cafe, people on a deadline pay to put themselves under the gaze of a manager in hopes of curing writer’s block. 

The cafe’s co-owner, Takuya Kawai, directs his customers to set a goal for the day and, if requested, prods them to get on with it. If they fail to meet it by the time they leave, they have to pay a fine equivalent to $22.

Tough Professors Are Better For Students In The Long Run (2011)

The research shows that although tougher professors don't give out as many A's and B's, and their student evaluations are not as good, their students do better when they get to upper level (junior and senior level) classes. 

Tuesday, November 03, 2026

Today Is Day Of The Deadweight Loss

On this day, economists mourn all the social welfare that has been lost in the last year. That social welfare is lost and we will never get it back. 

Deadweight loss is the loss of social welfare caused by that dreaded demon, inefficiency. Examples are monopoly and externalities and taxes. To learn more, go the following link:

Deadweight_loss

One good way to commemorate this day would be to cut out the deadweight loss triangle from a monopoly graph (like the one shown below) and burn it, to symbolize all of the lost social welfare. Doing so is both a life-changing and life-affirming ritual.

 

The green area is the consumer surplus and the red area is the producer surplus under monopoly. Add them together and you get social welfare. But if we had competition, social welfare would also include the yellow triangle. So there is more social welfare under competition and what we don't get under monopoly is the deadweight loss.

See also The Noise-to-signal Ratio as a Metaphor for the Deadweight Loss of Taxes.

See also Why High Taxes To Pay Back The Debt Might Be A Problem For Economic Efficiency And Future Economic Growth. I show graphically how taxes cause deadweight loss.

Sunday, November 01, 2026

From 1999-2024, the U.S. averaged 1.399% annual growth in per capita GDP while in Canada it was only 0.858%

You might look at 1.399% minus 0.858% and say "that is only a 0.541 percentage point difference." So what is the big deal? Compounding and how it adds up to a big difference over time.

This table shows the per capita GDPs for each country adjusted for inflation in each year (in  Canadian 2017$):

Country

1999

2024

Canada

$48,076

$59,529

USA

$58,842

$83,286

According to The Fraser Institute:

"In 1999, inflation-adjusted gross domestic product (GDP) per person in the US was CA$10,766 higher than in Canada. By 2024, that gap had more than doubled to CA$23,757." 

See Gap in living standards between Canada and the U.S. has more than doubled from 1999-2024; U.S. now $23,757 higher than Canada.

Even a small difference in growth rates ends up causing a very big difference in per capita incomes due to the annual compounding effect. 

This reminds me of the Rule of 72. If you want to know how long it will take a number to double, divide 72 by its annual growth rate. An economy that grows 2% a year will double in 36 years while the economy that grows 3% a year will double in 24 years. It will take 12 fewer years to double incomes.

The table below shows how much per capita income would be at various rates after 100 and 200 years. Assume we start with a per capita income of $1,000. If we grow 2.0% per year, after 100 years it will be $7,245. At 2.1% per year, it would be $7,791 or about $700 more. That is how much that little .1% matters. The difference over 200 years is about $11,000. After 100 years at 2.5% per year, per capita income would be $11,814. That is $4,000 more than the 2.0% rate. Small differences in growth rates add up to big differences over time.

Per Capita Income After 100 and 200 Years At Various Annual Growth Rates (Starting With $1,000)

Friday, October 30, 2026

Electric Camelot: An Economist Visits King Arthur's Court (Mark Twain on economics)

I have posted several items about Mark Twain on economics. Those are listed below. 

This is the title of an article that was published recently and was actually in Spanish by Rafael Galvão de Almeida. He is at Universidade Federal de Minas Gerais, Brasil. The title in Spanish is "Camelot Elétrica: Um Economista Visita a Corte do Rei Arthur."

It was published in the journal "História Econômica & História de Empresas" which means "Economic History & Business History." Click here for more information.

Here is the translation of the abstract:

"Mark Twain wrote the novel A Connecticut yankee in King Arthur’s court (1889) as a way to reflect on the changes happening in the so called “Gilded Age” of the United States. The book tells the story of Hank Morgan, an engineer whofound himself in the 6th century England, when King Arthur led the Knights of the Round Table in Camelot. Hank tries to industrialize England twelve centuries before, using his knowledge of technology, political economy and culture. His project of an Electric Camelot, however, suffers many problems and fails. The novel is relevant for economists because it deals with many topics of interest, such as entrepreneurship and economic development. The literature in the “visiting economist syndrome” – term created by Albert Hirschman – identifies many problems in the development aid process of a country due to a series of factors, including even arrogance and naivety of the economic models, but that are present when dealing with different contexts. It is argued that these problems have been discussed by Mark Twain, who had interest in the nascent neoclassical economics, in the referred novel. In spite of Hank being an engineer, his trajectory resembles a visiting economist. Thus, the novel is a tool to explore problems and challenges of economic development through fiction."

Related posts:

Chapter 33 Of Mark Twain's A Connecticut Yankee in King Arthur’s Court Is Titled "SIXTH CENTURY POLITICAL ECONOMY" And Deals With "Money Illusion"

Mark Twain On Work And Pay

Mark Twain On Labor Markets And How Wages Should Be Decided-By Government Fiat Or By Markets?

Mark Twain Understood That It Is The Purchasing Power Of Wages That Matters

Mark Twain, Free Trade and Tariffs

Mark Twain, Economist?

Wednesday, October 28, 2026

Sports economist J.C. Bradbury's latest book is This One Will Be Different: False Promises and Fiscal Realities of Publicly Funded Stadiums

Click here to go to the Amazon page. Here is the summary:

"For more than a century, America's sports stadiums have evolved from modest, private ballparks into billion-dollar play-palaces for the rich-built increasingly on the backs of taxpayers. Government commitments to major-league venues are approaching $50 billion, and a looming wave of new construction threatens to double public outlays by the end of the next decade. Elected leaders justify the massive subsidies by arguing that stadiums are economic catalysts, despite overwhelming evidence that sports venues are unwise public investments.

Why does this keep happening? The refrain is always the same: This one will be different. The Atlanta Braves's Truist Park in Cobb County, Georgia is the latest example. Marketed as a game-changing mixed-use development that would create a year-round economic hub, the project has fallen far short of its boosters' lofty projections-just like all the venues that came before it.

In This One Will Be Different, sports economist J.C. Bradbury draws from decades of academic research and his up-close and personal experiences with the Cobb Braves stadium deal to elucidate why publicly funded venues never deliver on their promises. Moving beyond the standard explanations of monopoly leagues and special-interest lobbying, Bradbury reveals how pliable politicians-drawn to the prestige and perks of professional sports-buck the will of their constituents to approve increasingly generous taxpayer handouts to billionaire team owners.

Authoritative yet accessible, this book blends economic analysis, political insight, and vivid storytelling to examine why politicians continue to fall for the stadium grift and presents practical steps for reform. Bradbury argues that improved transparency, greater understanding, and giving voters a direct say at the ballot box have the potential to break the stadium subsidy cycle."

Related posts:

Toronto saw little economic gain during the first two weeks of the World Cup (2026)

Leading sports economist calls current deal to publicly fund Spurs arena ‘insane’: Economist J.C. Bradbury warns that taxpayers will likely be on the hook for the pricy facility. It’s already happened in similar deals across the nation, he said. (2025) 

The economic impact of the Super Bowl is met with skepticism from economists (2024)

Economic benefits from mega-events like the Olympics are often overstated (2021) 

Striking out: estimating the economic impact of baseball's World Series  (2021)

As Covid-19 Closes Stadiums, Municipalities Struggle With Billions in Debt (2020) 

The San Antonio Spurs And Federal Subsidies (2016) (The Spurs received $41 million in federal subsidies to build the AT&T Center with little economic gain for the community-multiple studies show major private sports stadiums don’t ultimately produce substantial economic growth relative to the government incentives they receive)

Even If You Don't Like Sports, You Might Be Paying For Them (2011)

Does It Pay to Host the Olympics? (2009)

Sports, Economics and Politics Collide When Government Officials Get World Series Tickets (2009)

What Economists Say About "March Madness"  (2009) 

New York City Tax Payers To Pay $1 Billion To See Baseball (2008)

Monday, October 26, 2026

America’s population of 401(k) millionaires hits record high — thanks to strong market

By Zoe Hussain of The New York Post. Excerpts:

"The number of 401(k) millionaires has soared to a record high — buoyed by a strong stock market and robust employee contributions.

The number of retirement accounts managed by Fidelity Investments with at least $1 million jumped 19% between the first and second quarters — reaching a record 769,000 accounts, the investment firm told CBS News.

The deluge of retirement fund millionaires was driven by a bullish stock market and employees who put away money at historically high rates despite growing financial pressures, rising grocery costs, and pricey utility bills, the outlet reported."

"The gains were mostly made by older Americans who spent decades consistently saving and investing" 

Saturday, October 24, 2026

Harvard economics Professor Jason Furman has created a new website that tracks current economic data called Econvitals

Furman has also been a chair of the President's Council of Economic Advisors. Click here to go to Econvitals.

This is a great site if you want to see any current stats that are often mentioned in the media: GDP, inflation, unemployment, value of the dollar, interest rates, etc. The data is extensive and has lots of great tables and charts.

Here is what Furman says his site is about:

"I started this quickly, as part experiment and part useful resource for myself — a single place to keep all the data I like to look at when tracking the macroeconomy. Then I expanded it for a few friends, and now I’ve decided to take it public. It reflects my favorite ways of looking at and monitoring the economy, plus what I hope will become a growing set of broader perspectives that go beyond standard macro tracking. Some of it is idiosyncratic. It’s still very new, and I expect it to evolve, grow, and improve over time. It will always be free.

For most people, the main dashboard should be enough — it has all the major measures you’d want. But you can also go into much more detail on everything from GDP to financial conditions. For now it’s almost entirely focused on the U.S. economy, though there’s now a start on international coverage, which I hope to expand over time. There is also a set of tools on specific topics, like tracking speeches by FOMC members and forecasting the fiscal outlook.

A number of the measures here are my own constructions rather than an agency’s figure — the Ecumenical underlying-inflation gauge, Underlying Unit Labor Costs, the GDP and PCE estimates and more. Each is marked “Econvitals original” and explained in plain English on the Methods page. How the site handles email addresses and visits, and its terms of use, are on the terms and privacy page.

One caveat: this is very much a work in progress. I did all of the initial work myself and now Harvard College students Sriyutha Morishetty and Amar Besic are helping out. There are about 500,000 lines of code in the full system and I haven’t looked at a single one of them — it was all vibe coded. So I’d love your feedback, corrections, suggestions, and requests. Nothing is too small or too large, and I’m grateful for all of it — just email feedback@econvitals.org.

I hope you find it helpful and interesting.

Jason Furman"

Friday, October 23, 2026

Human drivers fight robotaxis in Washington, D.C.; a case of modern day Luddites?

When I taught I used a book called The Economics Of Macro Issues by Daniel Benjamin and Roger LeRoy Miller. It mentioned Luddites, people who destroyed industrial equipment in England in the early 1800s. They were weavers who lost their jobs to new machinery.

See D.C. Wants To Protect Ride-Share Jobs. Riders Could Pay the Price by Josh Pauzé of Reason Magazine. Excerpt:

"The District of Columbia is considering a bill to legalize commercial autonomous vehicles (A.V.s) in the city that would subject companies to hefty fees to fund programs for displaced ride-share drivers. Labor unions, religious leaders, and drivers gathered outside of the D.C. Council building on Tuesday to protest the bill and Waymo. Reason was on the ground to see it live.

Community members voiced a wide range of concerns about the prospect of self-driving cars coming to Washington, D.C. Worries included everything from road safety and job loss to surveillance and air quality issues from Waymo's tires."

"Autumn Weintraub, who leads 32BJ's App Drivers Union, was a key spokesperson for the protest. In her statement, she said the council is "rushing to open the floodgates for a bill that could cause people here in the D.C. area to lose jobs"

Related posts:

The AI Backlash Has Tech Executives Fearing for Their Lives (a case of modern day Luddites?): Violent threats against AI companies are rising and spilling over into real-world security incidents (2026) 

Driverless Trucks Are Here—and They’re Delivering Bags of Doritos (plus backlash aganist robotaxis): PepsiCo has 41 trucks on the road in Arizona, Texas and Arkansas, bringing the technology into the mainstream (2026) 

Romance novelist gets death threats on social media because she uses AI to help her write stories (2026)

The American Rebellion Against AI Is Gaining Steam Booed commencement speakers, blocked data centers, plummeting poll numbers: Fast-growing industry has a faster-growing crisis (2026) 

Two recent articles on robots and human workers (2024) (this mentions Luddites)

Tuesday, October 20, 2026

The Pyschology & Economics Of Decision Making Under Uncertainty (With Snoopy's Version From 1966)

See You’re So Self-Controlling by MARIA KONNIKOVA. From the 11-16 NY Times. She has a Ph. D. in psychology from Columbia University and is the author of the book Mastermind: How to Think Like Sherlock Holmes.


Also see A Talk With Lars Peter Hansen, Nobel Laureate. Also from the 11-16 NY Times. He won the economics prize for "contributing to the study of asset prices." It is related to the debate on theory of efficient markets. The idea is that stock prices make sense based on publicly available information. They won't be priced too high or too low.

Here is what Hansen says about "Decision Making Under Uncertainty."
"Yes, people struggle with how to cope with uncertainty; it’s not so easy for them to build probability models about the future in very complicated environments. That’s not realistic. We’re very much interested in rational agents who are coping with uncertainty.

What do you want to call behavior under those conditions? Well, you can call that irrational. I’m not sure that I want to do that; maybe it’s a useful term, maybe it’s not, I’m not quite sure.

How to cope with the uncertainties under complexity is a very important question that we’ve just scratched the surface of."

"Yes, the key thing there, too, is we were driven by empirical evidence, about how people behave. We were driven partly by that and partly by other insights coming out of decision theory — broadly conceived in terms of how people might cope with uncertainty. One thing I loved about rational expectations was that it said, to what extent is public policy grounded on being able to fool people systematically?"
The first article, discusses some recent research from psychology on "Decision Making Under Uncertainty." It looks into how people make decisions in the short-run based on expectations of the long-run. We might eat a slice of chocolate cake because that is great in the short-run but if we have a long-run goal to lose weight, it might seem like it is irrational or a case of low willpower if we eat the cake.

But what if it is uncertain as to how long it will take for a person to reach their weight loss goal? Once you are not sure when the payoff will come, you might think it will never come. So it is better, and perhaps rational, to at least have the cake now and get some pleasure because the weight loss may never come. Excerpt:
"A failure of self-control, suggest the University of Pennsylvania neuroscientists Joseph W. Kable and Joseph T. McGuire, may not be a failure so much as a reasoned response to the uncertainty of time: If we’re not quite sure when the train will get there, why invest precious time in continuing to wait?

Mr. Kable, who has been working on the psychology and neuroscience of decision making for more than a decade, argues that the truth is that in real life, as opposed to the lab, we aren’t nearly as sure we’ll get our promised reward, or if we do, of when it will come. 

“The timing of real-world events is not always so predictable,” he and Mr. McGuire write. “Decision makers routinely wait for buses, job offers, weight loss and other outcomes characterized by significant temporal uncertainty.” Sometimes everything comes just when we expect it to, but sometimes even a usually punctual bus breaks down or an all-but-certain job offer falls through. 

When we set a self-control goal for ourselves, we often have specific time frames in mind: I’ll lose a pound a week; a month from now, I’ll no longer get cravings for that cigarette; the bus or train will come in 10 minutes (and I’ve committed to taking public transportation as part of lessening my carbon footprint, thank you very much). 

But what happens if our initial estimate is off? The more time passes without the expected reward — it’s been 20 minutes and still nothing; I’ve been dieting for a week and a half now and still weigh the same — the more uncertain the end becomes. Will I ever get my reward? Ever lose weight? Ever get on that stupid train?
In this situation, giving up can be a natural — indeed, a rational — response to a time frame that wasn’t properly framed to begin with, according to a series of new studies conducted by Mr. Kable’s decision neuroscience lab at the University of Pennsylvania and published in Cognition and Psychological Review. 

“There are lots of situations, probably the majority of situations, in the real world,” Mr. Kable told me, “where waiting longer is actually a valid cue that the reward is getting further and further away.""
They have also done some experiments that back this up. Now here is the Peanuts comic which was originally from 1966, although it appeared again on 11-23. I think what Snoopy does and says is what the article was all about.

Peanuts

Related posts: 

Frank Knight And John Stuart Mill On The Purpose Of Life And Liberty  (2022)

Physicist suggests that our seemingly 'irrational' decisions may be more accurate than previously thought by current economic and behavioral economic theory (2020) 

What is split-brain decision making?  (2023) 

Two economists offer different advice for making life's tough decisions (2023)

‘Uncertainty and Enterprise’ Review: Known Unknowns: Risk can be quantified, uncertainty cannot. But paying attention to one’s doubts in business can inspire imaginative thinking (2025) 

How to Sail Uncharted Waters: Language foils our ability to think about the future. Phrases like ‘fair chance’ or ‘likely’ can be interpreted in many different ways (2025)

Sunday, October 18, 2026

Businesses Are Using AI to Transform Work, Not Cut Jobs

By Jaison R. Abel, Richard Deitz, Natalia Emanuel, and Nick Montalbano.They are all with The Federal Reserve Bank of New York. Excerpts:

"The ongoing advancement and adoption of artificial intelligence continues to raise concerns about widespread job losses. Over the past three years, our regional business surveys have asked firms about their AI adoption and its effects on their workforces. This year, we found that AI use among regional businesses has continued to rise sharply, with more than 60 percent of service firms and about half of manufacturers now using AI—a notable increase from 40 percent and 26 percent, respectively, reported in 2025. Despite this rapid adoption, regional firms’ investments in AI are generally modest, usage tends to be concentrated among a small share of workers within firms, and layoffs have remained uncommon. And, while some firms have scaled back hiring due to AI, others have added workers to help them use it. Retraining employees in response to AI remains the primary way firms are adjusting their workforces."

"most firms have made only limited investments in the technology. Three-quarters of service firms and more than 90 percent of manufacturers characterize their AI investments as minimal to modest"

"why have some businesses refrained from adopting it? . . . cost does not seem to be the main deterrent—it was among the least cited reasons by non-adopters. About half of non-adopters said the type of work they do does not lend itself to AI, while roughly a quarter indicated AI is currently not good enough to provide benefits to their business."

"Only 4 percent of service firms reported laying off workers in response to AI over the past six months, compared to just 1 percent in last year’s survey, while no manufacturers reported layoffs this year or last year. About 15 percent of service firms said they had hired fewer workers than they would have if not for AI use, similar to the 12 percent reported last year."

"some firms added workers to help them leverage AI. About 13 percent of service firms said they had hired more workers due to AI"

"existing workers are much more likely to be retrained than replaced by AI."

[there is] "limited labor market effects from AI adoption so far in terms of layoffs or reduced hiring. However, one recent study suggests entry-level workers may be affected significantly, as AI can substitute for routine tasks often performed by newer employees"

"firms are continuing to adapt and change due to AI use, but not by eliminating vast numbers of jobs. Instead, this new technology is reshaping work itself, with firms investing in their existing workforces rather than replacing large swaths of people."

"AI has been more likely to augment workers than replace them."

Other recent AI posts:

The vanishing advantage of specialization: AI, knowledge utilization, and the boundary of the firm 

AI and Employment: So Far, So Good 

AI is moderately heating up today’s economy while we wait for the likely bumpy rollout of productivity gains 

General Purpose Technologies like AI can increase productivity more than expected 

The age of the solopreneur: More solo founders, growing faster, powered by AI 

The AI Backlash Has Tech Executives Fearing for Their Lives (a case of modern day Luddites?): Violent threats against AI companies are rising and spilling over into real-world security incidents 

Friday, October 16, 2026

An Imaginary Dialogue: Plato and Shakespeare on the Exile of the Poets

I had an AI program write this a few weeks ago and I forgot which one.

Here was the prompt:

"Plato famously called for the expulsion of all imitative poets and dramatists—specifically naming major Greek literary figures like Homer, Hesiod, Aeschylus, Sophocles, Euripides, and Aristophanes—from his ideal city. Please create a dialogue between Plato and Shakespeare about Plato's decision to do this." 

A quiet room outside time. Shelves without end. PLATO sits with a wax tablet he is not writing on. SHAKESPEARE enters, glancing at the shelves as a man glances at a tavern he has heard stories about.


SHAKESPEARE: So this is the library where they keep the ones who were shown the door. I confess, I looked for my own name on the threshold.

PLATO: You were never in Athens to be shown anything, Master Shakespeare. My quarrel was with Homer, with Hesiod, with the tragedians who had the ears of my city. You came two thousand years too late to be exiled — and, I suspect, from an island too stubborn to build the kind of city I had in mind. 

SHAKESPEARE: A mercy, then, that I missed the verdict. Though I'd hear the charge all the same. You banished Homer — Homer — the man who taught Greece how to speak of courage and grief in the same breath.

PLATO: I banished no man. I excluded a kind of speech from the education of guardians. There is a difference, though I grant it comforted Homer little in the imagining.

 

SHAKESPEARE: Comfort him with the distinction, then, and tell me the crime.

PLATO: Two crimes, if you will have them counted. First: the poets lie about the gods, and worse, they lie beautifully, which is the more dangerous kind of lying. They show Zeus deceiving, the gods brawling like drunkards at a wedding feast. A child raised on such stories learns that the highest things are petty, and so aims low, thinking it aims like a god.

SHAKESPEARE: And the second crime?

PLATO: That imitation, by its nature, is a copy of a copy. Consider a bed. The carpenter makes a bed by looking to the Form of Bed — the truth of what a bed is. His bed is already once removed from that truth. Now the poet or the painter comes and makes an image of the carpenter's bed — not the truth of it, only how it appears from one angle, in one light. Twice removed, and ignorant of the thing he copies besides, for the poet need not know how to build a bed, or command an army, or govern a city, to write convincingly of carpenters and generals and kings. He traffics in seeming.

SHAKESPEARE: By that reckoning the mirror is a liar for showing my face without a skull beneath it.

PLATO: The mirror does not ask to be believed. Your plays do. That is the third and worst of it, though I named it second: poetry does not merely copy — it seduces. It goes to the part of the soul that grieves and rages and lusts, and it feeds that part, waters it, lets it grow strong, when the whole labor of a good life is to put reason in the saddle and keep the passions bridled. I have watched grown men weep at a recitation of Homer's laments who would be ashamed to weep so nakedly at their own father's grave. The poem gives them license. It flatters the very part of us we ought to be governing.

SHAKESPEARE: And yet — forgive me, Athenian — you are the most dangerous poet in this room, and you have not written a single verse.

PLATO: Explain the charge before you enjoy it further.

SHAKESPEARE: Gladly. You banish imitation, and then you go and imitate. You want men to see the Form of the Good, which by your own account cannot be looked at directly any more than the sun — and so what do you do? You do not hand them a syllogism. You tell them a story about prisoners chained in a cave, watching shadows, and one who is dragged into the light and comes back blinking to tell the others, who want to kill him for his trouble. That is not argument, sir. That is theater. You have written the finest short play in the history of philosophy, and you did it because you knew — as every poet knows — that the soul is moved by an image when it will not be moved by a proof.

PLATO: (after a silence) The cave is a likeness, offered honestly as a likeness, pointing beyond itself to what cannot be shown. I do not ask you to weep for the prisoners. I ask you to notice your own chains.

SHAKESPEARE: And I do not ask my audience to weep for Hecuba because Hecuba is real. I ask them to notice, in the weeping of a hired player over a queen who never lived, something true about grief that they could not notice in their own, being too near it and too proud. You say poetry waters the passions until they drown reason. I say a passion witnessed at a safe distance, in the dark of a playhouse, is a passion examined — turned over, understood, and in the turning, some of its power over us is loosed. A man who has watched Macbeth murder sleep for a crown is a man a little less easily tempted to murder for one himself. I do not paint vice to recommend it. I paint it to anatomize it, the way a physician draws the body's inward parts not to make the sickness lovelier but to teach the cure.

PLATO: That is a fine speech, and I notice it is also a performance — which is my whole point returned to you unharmed. You trust the discernment of your audience to draw the lesson and refuse the poison. I do not share your confidence, and neither, I think, do you entirely: for you also gave the world Falstaff, who is far more delightful than he is instructive, and I have heard that men love him more than they love the prince who casts him off. The poet's skill outruns the poet's moral. That is precisely the danger — not the bad poet, whom no one is tempted to believe, but the great one, who makes vice charming almost despite himself.

SHAKESPEARE: Guilty, perhaps, of loving Falstaff more than was prudent. But tell me, Plato — in a city with no Falstaff, no Achilles sulking in his tent, no Oedipus discovering the horror of his own hands, what would your guardians know of a human heart? You would raise philosophers who have never wept at a story, and call that safety. I call it a kind of blindness dressed as virtue. Even your own Republic cannot do without the poets entirely — you keep the hymns to the gods, the praises of good men, some of the old modes and meters, so long as they are bent toward courage and moderation. You do not silence the Muse. You conscript her.

PLATO: I conscript her because a city, like a soul, must be ruled by its best part, and the best part is reason, and reason may use images as a general uses scouts — sent out, but not given command. What I will not permit is the poet as an independent power in the city, answerable to no one, praised for whatever most delights, regardless of what it does to the men who hear it. Delight is not the same as good, though your trade has an interest in confusing them.

SHAKESPEARE: And what is philosophy's trade, if not the delight of being right? You have simply hidden the pleasure of your art behind the frown of the dialectic, so that it might pass the customs house of your own Republic unsearched. I at least tax my audience honestly, at the door, in daylight, and call the fee what it is.

PLATO: (the ghost of a smile) You argue like one of my own interlocutors — which is either a great compliment to you or a great embarrassment to me. Very well. I did not close the matter so tightly as report has made it seem. I said, at the end, that if poetry could speak for herself — not merely charm, but answer, and show cause why she should be welcomed into a well-governed soul as something more than honey on the rim of a cup — I would hear the plea gladly. No one has yet made it to my satisfaction.

SHAKESPEARE: Then let this stand as the opening of the brief, and I'll furnish the rest across some thirty-odd plays already written, and trust the jury of every uneasy conscience that ever left a theater more thoughtful than it came. I ask no throne for the poets, Athenian. Only a bench in the same city as your philosophers — near enough to the fire to be useful, far enough not to be mistaken for its keepers.

PLATO: A bench, perhaps. Not a bench beside the rulers.

SHAKESPEARE: (rising, with a bow that is not quite sincere and not quite mocking) I have sat in worse places for less honest company. Good night, lawgiver. Dream of your sun, if you can bear to look at it.

PLATO: Good night, player. Mind that Falstaff does not follow you out.

Exeunt, in opposite directions, each glancing once at the other's shelf.


Note: This is an imaginative dialogue. Plato's arguments here draw on the actual positions in Republic Books II, III, and X (the theory of poetic imitation as thrice removed from the Forms, the critique of poetry's appeal to the passions, and his closing offer to readmit poetry if she could defend herself). Shakespeare's counter-arguments are speculative, built from ideas his plays dramatize — most explicitly Hamlet's remark that playing should "hold the mirror up to nature" — but he never wrote a defense of poetry in his own voice, so his side of this conversation is invention in his likely spirit rather than record.