MPLan

The debate around improving safety in cities often revolves around whether this means deploying more police or not. In New York City, the recent mayoral election had certain candidates promise an increase in police patrols, while another candidate proposed the creation of a non-police unit to deal with certain issue (homelessness and mental health).

But do these non-police approaches work? A recent paper by Blattman, Duncan, Lessing and Tobon (2024) (“BDLT”) tackles this issue with a fascinating research design and find somewhat surprising answers!

Louie, Mondragon and Wieland (2025) show that typical supply constraints such as zoning laws cannot explain the observed price differences across cities.

What does? Income.

On October 13, 2025, the Nobel Prize in economics was awarded to Joel Mokyr1 – “for having identified the prerequisites for sustained growth through technological progress” – and Philippe Aghion and Peter Howitt – “for the theory of sustained growth through creative destruction”.

The work by Aghion and Howitt is very timely, as it may help explain some of the rise in genAI investment spending.

The US government has made headlines over the past year by taking an equity stake in Intel Corporation, along with 4 other companies. At the same, the US government has also levied significant tariffs, and continues to issue new debt (the current total debt to GDP is 125%).

So how are all of these topics connected? They’re all a form of tax.

Restricting college-educated immigration appears to:

    Reduce employment of locals;

    Reduce the wages of (most) locals;

    Reduce venture capital investment and IPOing;

    Reduce patenting;

    Increase outsourcing and offshoring.

Many of these effects are compounded when it involves smaller firms.

With the media posting sensational economic stats daily, filtering out the noise becomes crucial.

Should we care about Gross Domestic Product (GDP)? Does GDP reflect what matters? Is GDP a good measure? Recently, an influential tech podcaster and interviewer, Dwarkesh Patel, brought up the topic in the following context:

"As measured by GDP, AI will be super undervalued. How would the datacenter of geniuses show up in GDP? GDP would show raw inputs (aka chip & energy), and raw outputs (aka cost of tokens). But wouldn't clearly reflect the value of the crazy new [stuff] that's being cooked up in those tokens. Similar problem to how the Internet's value is undercounted today (since many products are free, and thus contribute nothing to measured GDP).”

Dwarkesh Patel is both right and wrong. To understand why, we need go over what is the GDP measure, why we measure it, and does it capture what matters to us.

Unemployment insurance, beyond consumption smoothing, allows people looking for jobs to find better job matches, which in turn increases earnings by $15,000 in the two years after UI receipt. The cost of UI, in comparison, is only $4,000.