Will more restrictive trade policies harm the U.S. economy by shielding domestic businesses against competition? That’s what standard economic theory holds, insisting that pressure from foreign rivals is needed for U.S.-based businesses to continue to innovate, to create the highest quality goods, and to sell them for the lowest possible prices. Although this theory has…
Read MoreIn response to the rise of “populism,” members of the Washington establishment have adopted a reassuring way to frame the question of America’s proper relationship to the world. As they see it, Americans are divided into two camps—open or closed, globalist or nationalist, interventionist or protectionist. In this framing, the closed, nationalist, and protectionist camp…
Read MoreHere are some facts about China from the World Bank: Since initiating market reforms in 1978 . . . China has experienced rapid economic and social development. GDP growth has averaged nearly 10% a year—the fastest sustained expansion by a major economy in history—and more than 850 million people have lifted themselves out of poverty.…
Read MoreSince it began operations in 2010, Uber has grown to the point where it now collects over $45 billion in gross passenger revenue, and it has seized a major share of the urban car service market. But the widespread belief that it is a highly innovative and successful company has no basis in economic reality. An examination of Uber’s economics suggests that it has no hope of ever earning sustainable urban car service profits in competitive markets…
Read MoreThe emergence of the internet changed the business landscape in fundamental ways. Computer-based services could be offered to anyone irrespective of geographic restrictions. This meant that internet companies could become globally significant with relatively little initial investment, as demonstrated by Facebook, Google, and several others. Their ability to rapidly concentrate wealth with relatively little overhead…
Read MoreIn ever more areas of life, algorithms are coming to substitute for judgment exercised by identifiable human beings who can be held to account. The rationale offered is that automated decision-making will be more reliable. But a further attraction is that it serves to insulate various forms of power from popular pressures. Our readiness to…
Read MoreWhy has digital technology so scandalously betrayed the expectations set by market liberalism? What accounts for the vast divergence between the starring role digital tech was meant to play in the global consummation of market liberalism and the disruptive, discrediting, disillusioning role it actually is playing? Why did liberal experts and liberal economics get it…
Read MoreA new practice of production has emerged in all the major economies of the world. The simplest and most telling of its many names is the knowledge economy. It holds the promise of changing, to our benefit, some of the most deep-seated and universal regularities of economic life and of dramatically enhancing productivity and growth.…
Read MoreCritiques of advertising are back. Ten years ago, casual talk about how advertising influences behavior would have come across as weird and paranoid—the preserve of the online conspiracy fringe. Today it is everywhere. Leading journalistic outlets fret over something resembling mind control. Politicos talk in ominous tones of stolen elections and Manchurian candidates. And government…
Read MoreThe traditional model of a “marketplace of ideas” was intended to justify freedom of speech in terms of its optimal outcome in the production of truth. But today our behavior on the internet, the main locus of the “marketplace of ideas,” is continuously monitored and processed through the analysis of big data. Complex algorithms categorize…
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