Marketing Some of My New Economics Papers

I have had a busy 2026. In this Substack, I want to market some of my new papers.

Location, Location, Location?

In this paper, I offer a gentle critique of a major modeling effort in macroeconomics and urban economics. A group of researchers lock in to the “quantitative spatial model” that assumes that there are places that have inherent productivity and these productivity levels differ because of past investments and natural geography. So, New York City has certain advantages over a Detroit and if a million talented people move to New York City that the overall output is higher there than if the same people had moved to Detroit. In the language of James Heckman, this is positing that selection effects are small and that urban treatment effects are large. In my paper, I argue that we are a superstar economy; where a Ken Griffin or an Elon Musk sets up business (think of Miami or Austin) ; these places will thrive as these Superstars initialize a process and talent follows them. My model offers a cautionary tale for people like Mayor Mamdani of New York City that the city’s tax base is less secure than he thinks. Under my “superstar selection model”, past superstar cities such as New York City could learn a nasty Laffer Curve lesson if the Mayor raises taxes without simultaneously improving local Services or if the city fails to adapt to local threats such as natural disasters.

Committing to a Project Evaluation Rule

Why do cities often build expensive rail transit systems that fail to achieve the ridership that boosters claimed they would? Why did California fund this Bullet Train that still doesn’t exist? Why isn’t project evaluation a more effective approach for pruning bad projects?

Economists have a simple answer. Of course, tax payers don’t want to pay for expensive, lousy services but they are busy and distracted. Nobody is looking out for their interests. The Mayor wants to create construction projects that benefit union labor and to attract Federal Subsidies and to have a big ribbon cutting ceremony. The Mayor can always find consultants to generate a Rosy report that envisions trillions of future riders creating low carbon emissions and enjoying the ride. This asymmetry between the tightly organized boosters and the distracted and dispersed tax payers (combined with Federal Subsidies) causes many bad projects to be approved. We end up with an inefficient government, rising deficits and angry and cynical voters.

In my paper, I discuss this incentive problem and propose how basic ideas from public finance can be introduced to give the silent majority a new tool to mitigate the asymmetric interest group problem.