This is per the 2026 discussion of AI “slop” writing.
One of the things I buy at an annual local rummage sale is cheap physical media like books. This year, I picked up a book by a cartoonist who I like and respect. I thought his book would be funny and prescient from the standpoint of the publication date (1995). The book is 250 pages of mostly slop. Humans wrote lots of slop and it got printed by publishers who had a captive audience.
Why did I have such high expectations for a printed book? I think it is because, as of 2026, we are more selective about what we print. A filtering has happened. Many novels printed 100 years ago were junk.
When I think of “books” today, what it really makes me think of is “classics” or the top 0.01% of books.
So, score one point for the slopistas. Human writing was not universally smart or inspiring.
What I hate about slop is seeing it in spaces I used to trust. There was a time when I could log in to LinkedIn and see human writing from people who I had chosen to follow because I like them as people. There was a contract for my attention that is broken with slop.
I sense some push and pull in the algorithm whereby the sites might be suppressing slop, right now, relative to what I was seeing weeks ago. I went to LinkedIn on 7/17/26 to do a slop check and saw none. They might be trying to preserve the lead that James identified earlier this year: The Hot Social Network Is… LinkedIn?
Oddly, one of the worst bot-infested spaces I tread into is Facebook groups about sourdough bread making. I think the space is not important enough for Facebook to police, and the human users are not very sophisticated when it comes to tech. I logged this observation back in January.
Most people have an intuition that uncertainty can harm economic outcomes. Baker, Bloom, & Davis (2016) and Bloom (2009) demonstrated that industrial production and manufacturing decline in the face of policy uncertainty. The typical mechanism that people suggest is that uncertainty about the future causes people to engage in precautionary saving, resulting in fewer sales.
The theory continues that firms consequently decrease production as demand for their output declines. Firms aren’t interested in causing the quantities supplied and demanded to be equal. Rather, they don’t want to produce too many goods that don’t get sold or don’t get sold at an adequate markup. Production is costly. A related theory is that more persistent or longer-run uncertainty can also depress investment, since the riskier future increases the tail risk of losses.
Rather than make a risky investment, one could instead just hold off and wait for some of that uncertainty to get resolved. There’s tradeoffs to this, of course. As future costs and benefits become clearer, they also get priced-in to asset values. So, there is an optimization problem. The possible downside outcome is big and uncertain. If the risk of the investment gets resolved and the downside outcome is still too likely or harmful, then a project manager did the ex-post ‘right thing’ by waiting.
But, if the downside risk disappears or is found to be very small, then waiting to invest in the project incurs an economic cost. Either 1) the profitable project and its associated profits will occur later and less valuably, or 2) other firms also resolve their uncertainty and bid up the price of the project’s inputs. Invest too early, and the downside is large and uncertain. Invest too late, and you may lose the potential upside partially or entirely.
But can uncertainty systematically increase profits?
Most academic journals are run by big for-profit publishing companies, and most of the rest are run by universities or big academic societies. The Journal of Healthcare Finance was an extreme outlier from this norm, run single-handedly by Editor-In-Chief James Unland since 1994. It was the rare journal that was free both for readers and authors.
I loved the idea of having a single person truly in charge and accountable without being slowed by a complex bureaucracy. But eventually a single person will want to, or have to, move on. Having an institution run a journal can ease this process, though an individual can still try to find their own successor.
In this case, The Journal of Healthcare Finance had been on hiatus since its Editor-In-Chief stepped back, with its last issue published in 2023. Their old website domain had expired- not a great look for anyone who published there and was going up for a job or tenure.
But now it is officially back at a new domain, with the single Editor-In-Chief replaced by a full editorial team, and accepting submissions again with the hope of releasing a new issue this year.
Selfishly, I’m happy to see this both because it means they will continue hosting my past publication, and to have a potential outlet for my future work. I recommend that other health economists and health services researchers give it a try, though as of now I have no personal experience with the new editorial team.
When we recently traded in for a newer car, we were handed two fobs. These are push-button start cars, so you absolutely need a fob to drive one. An old-fashioned metal key will not work. Even the hidden metal key in your fob is only good for unlocking the door, not for starting the car. Since life has schooled me that things get lost, I asked how much it would cost to get a spare fob made at time of purchase, hoping I might catch a break. Nope, the dealer cost would be $436. Ouch.
So, I later asked AI what to do. I was advised to have a non-dealer locksmith or hardware store do it instead. With this route, you might save even more money if you buy the blank fob yourself on Amazon for something like $30, and just have the locksmith program it and cut the hidden metal key.
A local ACE hardware store quoted me a price of $330, which is better than $436, but still not great. But I located a mobile locksmith, who drives a big van loaded with spare keys and fobs, and the equipment to cut key copies and to program fobs. He specializes in going and helping folks who are locked out of their cars, and he will drive to your house to make spare fobs and keys. He would come to our house to make a new fob for $270. But it gets even better – – if I had two fobs made in one visit, the price would be only $220 apiece. It was an offer I could not refuse, so now I have spares for both cars.
If you don’t have a working fob for the locksmith to work from: It turns out that for many foreign cars (Subaru, Toyota, and especially most European brands), it can be very difficult for a non-dealer locksmith to create a fob for you. Normally, if you find yourself locked out of your car some dark, snowy night, the mobile locksmith can roll up and create a new fob for you so you can get back in business. For brands like Ford, GM, Honda, and Nissan, he can accomplish this even if you can’t provide him with a working fob to copy. He will charge you twice as much, because it is a much harder job with no working template fob. It gets even harder for, say, Subaru. But for Mercedes-Benz or BMW, it may be impossible for most locksmiths to get a fob made on the spot without a working model to copy. In a big metro area, there may be a few locksmiths who have the specialized equipment for these brands; you’d have to call around and ask the locksmith especially if they can make a new, say, Mercedes fob for an “all-keys-lost” situation. If not, you may have to get towed on a flat-bed ($$$) to a dealer, who can read your vehicle and program the fob ($$$). There may be a middle ground (which will take some days to play out) where you order a blank fob from a dealer along with some essential info for your locksmith to complete the programming, or where you order a programmed fob by mail.
All this argues for having a spare fob made ahead of time; maybe stash it somewhere that a friend or family member could bring it to you, if you were in distress not too far away.
Bonus fob tip: If your fob battery dies, you can still start your car by using the conventional metal key hidden inside your fob to open the car door, and then hold the fob very close to the car ignition button as you push the button, with your foot on the brake as usual.
I had an interesting dinner with two macroeconomists, Paulo Lins and Michael Navarrette. A follow-up conversation led to me skimming this paper, which dives into the regional heterogeneity of food inflation. Now inflation is not something we typically think of having particularly local or granular heterogeneity (“inflation is everywhere and always a monetary phenomena”, etc, etc), but it’s important to remember that the biggest difference between chalkboard inflation and real-life inflation is measurement.
Economic data is something we often take for granted, in no small part because it’s the substrate from which so much economic research is grown. To fight over it almost feels like nihlism. But just because we aren’t fighting about it doesn’t mean that measurement is easy. It is, in fact, brutally challenging for a host of reasons. Now, a lot of those reasons come down to the demand for immediacy in measurements, which can in turn be dealt with through updates over time. But there’s a deeper challenge that we shouldn’t lose sight of.
Every good is a bundle.
A tomato is a vegetable that is secretly a fruit. Sometimes the price is higher, sometimes it’s lower. But here’s the rub: sometimes when the price is higher it’s secretly lower, and vice versa. Sometimes it’s the same, only it’s not. Sometimes that modestly increased price is secretly a catastrophic increase threatening marinara all across the nation.
Yesterday the tomatoes I bought were 3 for $2. Today they were 2 for $1.50. A modest 11% increase in price. Ah, but see, it isn’t.
The tomatoes today are a little smaller. They came from farther away, representing a seed line that is more tolerate of travel and refrigeration. They are less uniform in color, more acidic, less sweet. Diving deeper, we find that the cost for a 100 lbs of tomatoes purchased in bulk were unchanged. There was, however, less variety to be chosen from because those crates of bulk tomatoes were increasingly curated to fit the needs of Sysco, the chief purveyer for mid to lower tier restaurants, which needs them more for median-customer approved red sauces than spinach salads and bruschetta.
So, dear reader, I ask you – did the price of tomatoes go up? For me, they certainly did. For the median American they barely budged. For Pizza Hut they may have actually gone down!
It’s easy to see how complex goods are bundles of attributes, but it’s amazing how products as commodified as sand or amino acids for livestock feed can quickly become bundles once you put yourself in the shoes of the customers for those goods. When quality, timing, and uniformity enter the mix, damn near every good becomes a rich bundle of attributes for which profit-maximizing suppliers are working diligently to not just meet the needs of their customers, but serve the terms of the explicit and implicit contracts from which any deviation brings the spector of margin-spoiling transaction costs. There’s a lot of gravity at the status quo. Which, in a way, is simple rediscovering menu costs, but with the important distinction that just because the number on the menu hasn’t changed doesn’t mean the price hasn’t. The menu is a lie.
Claude Fable is Anthropic’s most capable publicly available “Mythos-class” model. It is optimized for long-running autonomous tasks and deep knowledge work. The roll out of this product has been dramatic. Little people like me have access to it for only two weeks, and I doubt I will be able to afford it thereafter. With my window of access, I posed it the following prompt:
“This article indicates that a much smarter model might not be possible because the universe is opaque. Since Tyler Cowen made this statement, AI has helped people make breakthroughs in math and biology. Write this again in 2026 using the latest state of technology. Is the smartest LLM today much smarter than GPT-4? And is the universe legible?” and I copied in my blog post Is the Universe Legible to Intelligence?
One line from Fable’s response: “Notice where the wins clustered: mathematics with checkable proofs, protein structures with experimental ground truth, contest problems with known answers. These are the maximally legible domains — places with a fixed target and a way to verify that you hit it.”
The writing is coherent and contains no obvious hallucinations. Is the answer true, and does it tell the whole truth?
Whenever you read something think about who wrote it, and keep in mind that every author/model has a bias and limitations. In my paper with Will Hickman, we found that just reminding people that a paragraph has an author (whether the author is human or AI) increased the demand for fact checking from readers. LLMs will become more persuasive and closer to (but never completely) correct. Keep reading all things with some skepticism whether they are written by scientists, politicians, or AI.
Regardless, there is definitely such a thing as making the known world more legible to AI today. Thus, people are talking about increasing funding for data availability and the possible demise of the “research paper.”
One of my strongest AI/research takes is that it dramatically increases the value of building new descriptive datasets, digitizing archives etc.
Analysis might be free now, but Fable can’t deduce historical city sewer budgets from first principles. https://t.co/PiJngivhqK
Research papers are more like stories than facts. The demand for stories is not going away, but I definitely cannot predict the future of the write-for-pay scientist.
AI, potentially, could go and get its own new data, instead of waiting for humans to archive it. Thus, the self-improving AI might take us beyond the current models… unless they run up against something that is not legible to intelligence…
Voters this November will face a proposed amendment to the Florida state constitution on property tax reform. Currently, Florida has what’s called a ‘homestead’ exemption of $50,000. If a residential property is your primary residence, then your home’s assessed value is $50k less before taxes are calculated. There is no exemption for rental property or 2nd homes or vacation homes. The proposed amendment increases the exemption to $250k by 2028 and then indexes it to inflation.
First, let’s get an idea of the magnitudes. The median home in Florida is priced at about $400k and the average property tax rate is around 0.8%. Below compares the current consolidated tax bill against that of the proposed amendment. Given current home prices and local tax rates, the new exemption would have a huge impact on municipal governments who get the bulk of their revenue from property tax. In fact, there is no Florida state property tax, so the proposed amendment would adopt a new rule for municipalities and not the state government.
What Motivates the Amendment?
The current homestead exemption of $50k was established in 2008. A subsequent amendment in 2024 allowed half of that to be indexed to CPI-U. The average home price in Florida has risen 114% since 2008 and 84% since 2020. That’s a lot faster than inflation, but the tax burden is partially offset by a maximum of 3% annual increase in assessed value. Regardless, many individuals face a larger tax bill over time even independent of whether their income or use of public services has changed. Plenty people are feeling the squeeze.
What’s the Purpose of the Homestead Exemption?
The exemption is available for primary residences only. That means that rentals and vacation homes do not qualify. It’s important to keep in mind that, given some total revenue, every tax break for one group or activity implies a higher tax rate for others. So, clearly, the effect is to tax residents less and tax seasonal residents and visitors more. Florida doesn’t have an income tax, but it does have a sales tax, gasoline tax, and others that are disproportionately borne by non-residents. Given that higher income individuals tend to have higher home values, the homestead exemption is a way to lower the tax burden of lower income households. Obviously, the lowest income individuals are renters, but so are non-residents who Florida prefers to tax.
The Economics
Homeowners
The exemption is enjoyed by all primary residences, but helps low income owners the most. And, given a stable amount of municipal tax revenue, a higher homestead exemption requires that municipalities replace that revenue. This might take the form of higher local fees and taxes, making life harder for lower income people to, say, own a car or make purchase if taxes on those activities rise. Revenue stability might also be helped by higher property tax rates. The higher the property value is above $250k, the greater the average tax burden that is borne. So, someone with a very high property value may find themselves with an even higher property tax bill after municipalities adjust to the proposed statewide rule. In this sense, the new amendment would be a step in the direction of tax progressivity (a higher proportion taxed from those with higher income/wealth).
Indexing
Normally, I am in favor of indexing nominal values to CPI. In this case, we need to think about what the goal is. Let’s assume that the goals is to provide relief to lower income homeowners specifically and all primary residence homeowners generally. Does indexing to the CPI help? It depends!
The conventional wisdom is that the NBA regular season has too many games. Teams play worse because they are tired, or injured, or resting their stars so they can be ready to actually play hard in the playoffs.
Teams on the second night of a back-to-back shoot less efficiently (lower eFG%), grab fewer offensive rebounds, and play at a slower pace. On defense, they allow opponents to shoot more efficiently, force fewer turnovers, and give up more free throw attempts and second-chance opportunities. Turnover percentage and offensive free throw rate did not change significantly, consistent with our conceptual framework’s distinction between effort-dependent and execution-dependent metrics. While not every metric changed significantly, the overall pattern is clear: second-night back-to-back scheduling is associated with a measurable decline in team performance
The effect sizes here tend to be small, around 0.5-2%, but they are statistically significant given that we studied over 20,000 games, and practically significant given how close NBA games are.
Max had the idea for this paper and wrote the first draft as a student in my Economics Senior Capstone class in 2025. After he graduated, I joined the paper as a coauthor to get it ready for journals. We share the data and code for the paper here.
My post and chart from last week showed the phenomenal growth of average income in the US since the Founding. Using GDP per capita historical estimates and adjusting for inflation, this figure is about 46 times greater today than right around the time we declared independence.
It will probably not surprise you that some folks were skeptical. Could this really be true? Two major objections were raised to using GDP per capita. First, wouldn’t it be better to use a median income value rather than a mean (simple average)? Second, wouldn’t a measure of wages be better than GDP per capita?
I really would like to show you an annual series of median income data back to 1776, but unfortunately it just doesn’t exist. Good median income data are hard to find much before the 1950s, much less the 1770s. However, while median values are often better for showing levels, the growth rates of median wages and mean wages aren’t that different for periods when we have comparable data. Consider the following chart, which compares median wages (as calculated by EPI using CPS data) and mean wages (from BLS’s series for non-supervisory workers) since 1973. I have stated these in nominal terms, so don’t take this as real growth rates, but rather it is a raw comparison of two series (we could apply the same inflation adjustment to both, but that won’t change the picture, only the numbers).
Median wages increased by 667% and mean wages increased by 657%, almost identical. Again, these aren’t inflation adjusted, but that’s not the point of this exercise. The point is that whether you use mean or median wages, at least since 1973, the growth rates are the same. Was this true if we went back another 200 years? We can’t say for sure. But many people have this same skepticism about mean wages in recent decades. I think it is better to use median values when you have them, but we shouldn’t throw up our hands and claim we know nothing if all we have is mean wages.
Next, consider the following chart. It begins in 1790, but instead of using GDP per capita, as I did last week, it uses a measure of average wages from economic historian Lawrence Officer. This measure is for “production workers in manufacturing,” and it is a total compensation measure, meaning that it will include the value of fringe benefits as well — though these aren’t noticeable in the data until the 1930s. This is still an average value, but because it is for manufacturing laborers, it won’t be distorted by the wages of managers and owners in that industry, and it won’t be affected by the growth of new industries that might require more years of education (indeed, manufacturing wages are lowering than overall average wages today, so this is taking the hard case). I have also included a second line, which only includes manufacturing wages (not benefits) that I have blended with Officer’s compensation series starting in the 1930s, in case you think including benefits is somehow “cheating.” (Note the log scale again, as in last week’s chart.)
The trends here are very much in the ballpark from the GDP per capita chart I created last week. Using total compensation, wages are 65 times higher than in 1790. Using only wages, they are 49 times higher. Notice that these are both better than the 46 times multiplier using GDP per capita. How is that possible, since I am using the same price deflator in both cases? First, average hours of work have fallen significantly since the 18th century, so incomes haven’t risen quite as much as wages. Second, there was a bit of a decline in GDP per capita during the Revolutionary War, and if we use 1790 as the baseline for GDP per capita, the multiplier is 63. But again, these numbers are all in the ballpark: whether the true figure for a typical American is 46x, 49x, 63x, or 65x, this is a tremendous amount of economic growth.
If you want to look at that chart pessimistically, you will see that there is some reduction in growth rates in the past few decades. That’s true whether we use wages or compensation. This is a well known issue, and has been discussed endlessly in academic papers and on social media. I don’t want to glaze over it here, but I mostly will: the long-run trend of growth in the US is amazing. That’s true whether you use GDP per capita, or wages or compensation for production workers.
So once again, Happy 250th Birthday to the USA and all of you living in the wake of that amazing 250 years of economic growth!
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Economist Writing Every Day 