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First, regulatory policy has an impact on the speed of diffusion of the technology and the form that the technology takes. While the existing empirical work does not focus on AI specifically, the evidence to date suggests that most government-mandated privacy regulation slows technology adoption and innovation, suggesting a trade-off between the right to privacy and the speed of innovation (Goldfarb and Tucker 2012). This means that policy preparation in advance of the diffusion of AI should consider both business cycles and education policy. This has led to an increase in antitrust scrutiny of the leading technology firms from governments (particularly the European Commission) and in the press (see, for example, The Economist’s 20 January 2018 cover story, “The new titans, and how to tame them”, and their subsequent story, “

We show how two versions of this latest generation of modern business cycle models, which are real business cycle models with frictions in labor and financial markets, can account, respectively, for the aggregate and the cross-regional fluctuations observed in the United States during the Great Recession. In this article, we outline a state-of-the-art version of HANK together with its representative agent counterpart, and convey two broad messages about the role of household heterogeneity for the response of the macroeconomy to aggregate shocks: 1) the similarity between the Representative Agent New Keynesian (RANK) and HANK frameworks depends crucially on the shock being analyzed; and 2) certain important macroeconomic questions concerning economic fluctuations can only be addressed within heterogeneous agent models. Full-Text Access | Supplementary Materials "Nonmonetary Incentives and the Implications of Work as a Source of Meaning," by Lea Cassar and Stephan Meier Empirical research in economics has begun to explore the idea that workers care about nonmonetary aspects of work. Full-Text Access | Supplementary Materials "Social Connectedness: Measurement, Determinants, and Effects," by Michael Bailey, Rachel Cao, Theresa Kuchler, Johannes Stroebel and Arlene Wong Social networks can shape many aspects of social and economic activity: migration and trade, job-seeking, innovation, consumer preferences and sentiment, public health, social mobility, and more.

"Black-white economic inequality remains large and persistent, and recent wealth inequality trends for all Americans are explained by assets, not income": "Black-white economic inequality remains large and persistent, and recent wealth inequality trends for all Americans are explained by assets, not income": Race, and the race between stocks and homes, by Douglas Clement, The Region: Most research on long-term U. S. inequality focuses on income; relatively little examines wealth, largely due to lack of good asset data. The median black household has less than 11 percent the wealth of the median white household (about $15,000 versus $140,000 in 2016 prices). The race between stocks and homes To explain the divergent trends in income and wealth inequality before the crisis, the economists draw on a key strength of the database: It includes both income and wealth information, household-by-household, and 70 years of balance sheets with detailed portfolio composition. In “a race between the stock market and the housing market,” the economists write, the richest 10 percent, by virtue of a climbing stock market, enjoyed soaring post-crisis wealth, while average household wealth largely stagnated.

Oh, What a Stupid Trade War (Very Slightly Wonkish), by Paul Krugman, NY Times: So, the trade war is on. The proper answer about the job-creation or -destruction effect of a trade policy – any trade policy, no matter how well or badly conceived – is basically zero. We do want to know whether the Trump trade war ... would add or subtract jobs holding monetary policy constant, even though we know monetary policy won’t be constant. Most obviously, cars and other durable manufactured goods will become more expensive to produce, which means that we’ll sell less of them; and whatever gains there are in primary metals employment will be offset by job losses in downstream industries.