Tipping is large and growing, but we know little about its consequences for workers and firms. We link point-of-sale and payroll records at 20,000 U.S. firms, which lets us observe tips from customer payment to worker earnings. We find that tips are a nearly constant share of revenue, which means hourly pay moves with revenue.…
The economics of tips
The economics of tips
05 Nov 2026 1 Comment
in applied price theory, history of economic thought, industrial organisation, labour economics, labour supply, managerial economics, market efficiency, organisational economics, personnel economics
The Great Enrichment
04 Nov 2026 Leave a comment
in economic history, entrepreneurship, industrial organisation Tags: The Great Enrichment, creative destruction
‘Production, Information Costs, and Economic Organization,’ by Armen Alchian & Harold Demsetz
03 Nov 2026 Leave a comment
in applied price theory, Armen Alchian, history of economic thought, industrial organisation, law and economics, market efficiency, property rights, Ronald Coase, Ronald Coase, theory of the firm
In “Production, Information Costs, and Economic Organization,” Armen Alchian and Harold Demsetz ask when joint production works better inside a firm than across markets, and what form that firm takes. Their answers turn on a measurement problem: When people produce together, total output doesn’t reveal what each person contributed. Measuring individual contributions is costly, and…
‘Production, Information Costs, and Economic Organization,’ by Armen Alchian & Harold Demsetz
All About Tariffs
31 Oct 2026 Leave a comment
in applied price theory, economic history, history of economic thought, industrial organisation, international economics, politics - USA, Public Choice, rentseeking Tags: tarrifs
I have made no secret of me deep skepticism about President Trump’s tariff policies since he announced his “Liberation Day” tariffs in April 2025. My first-blink “Thoughts on the Trump Tariffs” from a few days after the announcement has held held up reasonably well, and I have posted follow-ups on the subject a number of…
All About Tariffs
Quotation of the Day…
29 Oct 2026 Leave a comment
in applied price theory, Austrian economics, entrepreneurship, industrial organisation, Israel Kirzner
Tweet… is from page 30 of Israel Kirzner’s 1985 volume, Discovery and the Capitalist Process [original emphasis]: What is important about the market economy is that unexploited opportunities for reallocating resources from one (low market valued) use to another of higher value offer the opportunity for pure entrepreneurial gain. A misallocation of resources occurs because,…
Quotation of the Day…
How to Profit From a Cartel Without Joining One
27 Oct 2026 Leave a comment
in applied price theory, econometerics, economic history, economics of regulation, financial economics, industrial organisation, law and economics Tags: competition law
Adam Smith warned that people in the same trade rarely meet without the conversation turning to a scheme to raise prices. Antitrust enforcers on both sides of the Atlantic now suspect they can skip the meeting—a shared shareholder may do the job. In May 2025, the U.S. Justice Department (DOJ) and Federal Trade Commission (FTC)…
How to Profit From a Cartel Without Joining One
‘Contemporary Law and Economics,’ by Adam Chilton, Joshua C. Macey & Mila Versteeg
24 Oct 2026 Leave a comment
in applied price theory, economics of regulation, history of economic thought, industrial organisation, law and economics, Richard Posner, Ronald Coase
What does it mean to be a law & economics (L&E) scholar? It can’t require a Ph.D. in economics. Richard Posner doesn’t have one. He didn’t even major in economics as an undergraduate, preferring English—as did his Chicago colleagues Douglas Baird and Diane Wood. It can’t require a law degree, either, or Ronald Coase, William…
‘Contemporary Law and Economics,’ by Adam Chilton, Joshua C. Macey & Mila Versteeg
Starlink Holdup?
23 Oct 2026 1 Comment
in defence economics, entrepreneurship, industrial organisation, war and peace Tags: Ukraine
Ukraine’s military has become heavily dependent on SpaceX’s Starlink satellite network for battlefield communications and drone operations. They have invested relationship-specific sunk costs into SpaceX’s satellite communications platform. According to a new Wall Street Journal report, Elon Musk ordered restrictions on a military version of the service last week, disrupting Ukrainian offensive and defensive drone…
Starlink Holdup?
‘The Value of the Ability to Deal with Disequilibria,’ by Theodore Schultz
23 Oct 2026 Leave a comment
in applied price theory, entrepreneurship, history of economic thought, industrial organisation, survivor principle
The most valuable skill in the age of artificial intelligence (AI) may not be coding, prompt engineering, or any of the other competencies appearing in job listings. It may be the ability to figure out which skills will be valuable next. Half a century ago, Theodore Schultz had a name for something much like this:…
‘The Value of the Ability to Deal with Disequilibria,’ by Theodore Schultz
Ridley: The forecaster’s paradox
21 Oct 2026 1 Comment
in economic history, economics of media and culture, entrepreneurship, financial economics, industrial organisation
Why does nobody see new technology coming?By Matt Ridley. He is a British writer who has a Ph. D. in zoology.My last post was an AI generated discussion between Jules Verne and Mary Shelley on the future of technology and how it would affect people.Ridley explains how hard it is to predict the future. Many technologies…
Ridley: The forecaster’s paradox
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