For the world as a whole, average birth rates have been falling for decades—from about 5 in 1950 to a little above 2 today. Two-thirds of people today live in a country where the birth rate is below an average of two children per two adults, which means below the fertility level needed to sustain population sizes (without net migration). In this paper, we assess whether low fertility is likely to persist as a global phenomenon. We distinguish cohort birth rates, which matter for generation-to-generation population change, from period birth rates, which present a snapshot of birth rates at a point in time, but may offer less insight on longer-run possibilities. Where cohort birth rates have fallen low, they have not subsequently rebounded. We show that both increasing rates of lifetime childlessness and smaller family sizes among parents have contributed to falling cohort birth rates. Pronatal policies, we discuss, can have large effects on the annual fertility data without substantially changing the average number of children women have over their lifetimes. Although future birth rates remain uncertain, we conclude from the evidence that, over a long horizon, persistent low fertility is a likely future.

Falling fertility and improved mortality create a powerful and inexorable demographic arithmetic of ageing in the coming decades around the world, with three patterns. The richest countries, along with China and the Former Soviet Union, will see absolute declines in the labor force aged (15-64) population and absolute rises in those 65 plus. All major developing country regions except for Africa: Latin America, South-East Asia and Pacific, South Asia, and West Asia/Middle East, will experience modest labor force growth to 2050 (less than 30 percent) aged combined with rapid growth of those over 65 (doubling or tripling). The fall in fertility in Africa (Sub-Saharan and North) started later and has fallen much less and hence, in standard scenarios for 2050, Africa will account for 80 percent of all global net growth in the world’s labor force aged. A fundamental feature of the global economy over the medium-run to 2050 is that that highest labor productivity countries will have absolutely fewer native-born workers and Africa, home to many of the world’s lowest productivity countries, will have 800 million more labor force aged. The combination makes possible gains on the order of trillions of dollars to policies that creating legal pathways to allow people, particularly youth, to move from low productivity, labor abundance places to high productivity, labor scarcity places. But, so far, politics has not found the way to “yes” for this win-win scenario.

Asian Americans are the fastest-growing immigrant group in the United States, yet Asian immigration remains relatively understudied in quantitative social science. This paper reviews the historical evolution of Asian immigration, focusing on six major origin countries—China, Japan, India, the Philippines, Korea, and Vietnam—to show how US immigration and foreign policy shaped the size and composition of immigrant arrivals. It then examines subsequent patterns of demographic composition, geographic settlement, and socioeconomic characteristics. Taken together, the evidence highlights the enduring influence of US policy regimes on Asian immigration over time.

Even allowing for uncertainty about the future economy, current US fiscal policies are almost certainly unsustainable. Therefore, policymakers must decide when and in what ways to raise taxes and reduce spending to put debt on a lower trajectory. Acting sooner rather than later would increase national savings, broaden the policy options, reduce the chance of a fiscal crisis, and provide fiscal space for responding to adverse developments. The probability of a near-term fiscal crisis is difficult to assess: Yields on Treasury debt are within their ranges of the past few decades, which suggests that investors are not that worried about the budget outlook—but debt and deficits are at exceptionally high levels, and experience shows that investors’ confidence in a government’s fiscal management can deteriorate quickly.

We decipher the riddle of the meteoric rise of the Asian Miracles—Korea, Taiwan, Singapore and Hong Kong, and Japan before them—in the second half of the twentieth century. We argue that the secret of their success lies in the specific type of industrial policy focused on technology and innovation. This overarching policy focused on exports of sophisticated products by domestic firms while fostering fierce domestic competition and accountability for the support received. The successful implementation of this policy depended on a particular type of institutions—a leading agency with a distinct institutional design and a mandate to develop sophisticated industries. The experience of the Asian miracles provides a blueprint for developing economies to achieve rapid convergence with advanced economies. It also suggests a reassessment of the roles of the state and the market, the appropriate tools of industrial policy, and the meaning of “good” institutions.

We analyze the risks associated with Japan’s prolonged low-interest rate policies amid a global environment of rising rates. To finance its persistent deficits, the Japanese public sector depends on inexpensive domestic funding to invest in risky assets both domestically and internationally, effectively creating a sovereign wealth fund fueled by borrowed money. Ultimately, these risks fall on Japanese bondholders, depositors, and taxpayers. While the United States faces similar fiscal pressures, it is unlikely to adopt Japan’s approach.

We argue that rising regional inequality contributes to higher average housing prices and rents. We show three key empirical facts that contribute to this mechanism: first, income growth has been faster in already high-income cities; second, people are drawn to these cities by the income growth, raising relative housing demand and relative housing prices and rents; and third, housing supply in these cities is inelastic due to density and regulation, so these cities have not produced the housing to match the rising demand. We illustrate the resulting changes using a graphical spatial model in which rising regional inequality reallocates population toward high-income, supply-constrained areas. This shift raises national average housing prices and rents.

This paper considers questions about the implications of rising inequality for the theory and practice of public finance. It begins by addressing fundamental reasons why the distribution of income or wealth on an annual basis before taxes and transfers offers insufficient information: (1) it does not tell us what resources are actually available to households for consumption; and (2) in providing a snapshot of the resources available to individuals of different ages at a given moment in time, without controlling for life-cycle related differences or income dynamics, it can provide a misleading estimate of the underlying degree of inequality. The paper then considers the implications of high and perhaps rising economic inequality for the design of government policy: top marginal tax rates, phase-outs of government policies for those with higher incomes, the political economy of inequality, and other subjects.

How should antitrust enforcers treat acquisitions by successful firms to enter new markets? Should a major pharmaceutical company with an extensive sales and distribution network be permitted to acquire a popular drug that does not compete against any of the drugs it already owns? Throughout American economic history, expansion by successful firms into new markets has played a vital role in promoting competition and spurring economic growth. However, acquisitions to enter new markets also can harm competition by enabling monopolists to enlarge their empires. The 2023 Merger Guidelines break new ground by announcing that the US antitrust agencies will challenge mergers and acquisitions that “could enable the merged firm to extend a dominant position from one market into a related market,” but they say very little about how such acquisitions will be evaluated. This article explains how antitrust enforcers can use economic evidence and theory to distinguish between acquisitions to enter new markets that are harmful and those that are beneficial.

The 2024 John Bates Clark Medal of the American Economic Association was awarded to Philipp Strack, Professor of Economics at Yale University, for his pathbreaking contributions to the study of individual decision making, which have introduced new techniques, improved our understanding of important economic phenomena, and helped spark a new wave of research on the economics of information while building bridges between modern economic theory and a wide range of adjacent disciplines. This article summarizes some of Philipp’s papers, and explains how they build on and improve previous work.