Ricardo's threads | Nothing contributes so much to the prosperity and happiness of a country as high profits

FEDS Paper: A New Reason to Hate Grocery Inflation: Measuring and Interpreting Inflation Heterogeneity

01/05/2026 Federal Reserve Central banks

Kelsey O'FlahertyThe 2021-2022 inflation episode presented the first opportunity to examine inflation and price dispersion using U.S. scanner data in a high-inflation environment. Data from 50,000 outlets reveals that price changes across similar goods grew more dispersed in 2022 before falling again in 2023. This paper documents how price change dispersion interacts with households' product choices to generate substantial inflation heterogeneity.

Can office culture survive the work-from-home revolution? Yes, but you can’t force the fun

01/04/2026 The Conversation News & Comments

Getty ImagesGroaning your way back into the new work year? It’s an occupational hazard after the holiday break, of course, but these days there is the consolation (for some) of hybrid working.

For jobs that allow it, hybrid work is the new normal, allowing employees to work both remotely, usually from home, and in the office.

In a world of digital money, what’s the right etiquette to split the bill with friends?

12/30/2025 The Conversation News & Comments

Vitaly Gariev/UnsplashWe’ve all been there – splitting a bill at dinner, covering a mate’s coffee, or sending a quick transfer for concert tickets. It’s part of modern social life. As money becomes increasingly digital and instantaneous, we no longer need to worry about doing maths in our heads or fussing about changing notes and coins.

FEDS Paper: The Effect of Liquidity Constraints on Labor Supply: Evidence from Interest Rate Ceilings

12/22/2025 Federal Reserve Central banks

Kabir Dasgupta, Brenden J. MasonWe exploit the spatiotemporal variation in US states’ interest rate ceilings on small-dollar loans to identify the effect of liquidity constraints on labor supply. Exogenously-capped interest rates lead to consumers being shut out of the market for cash loans. In response, labor supply increases by approximately 0.4 hours per week. We also find that the propensity to take personal leaves decreases.

Could Settlers of Catan make you a better strategist?

12/22/2025 The Conversation News & Comments

Marcelo Ferrari/PixabayChristmas is just around the corner, and you might be wondering how to spend those long, lazy afternoons. If you’re tired of the same old Monopoly, perhaps it’s time to try Settlers of Catan.

FEDS Paper: Estimating Aggregate Data Center Investment with Project-level Data

12/22/2025 Federal Reserve Central banks

Eirik Eylands Brandsaas, Daniel Garcia, Robert Kurtzman, Joseph Nichols, and Adelia ZytekData center investment in the U.S. has increased rapidly in the post-pandemic era, and plans for future investment have surged further.

The digital euro: awareness, adoption and household portfolios

12/22/2025 European Central Bank Central banks

Based on a series of novel experiments fielded within the ECB’s Consumer Expectations Survey, we provide evidence on the attitudes of euro area consumers towards a possible central bank digital currency (CBDC). We document substantial socio‑demographic heterogeneity in consumers’ awareness and willingness to adopt a CBDC. According to survey responses, a sizeable share of around 45% of households would be interested in potentially adopting this new asset.

FEDS Paper: HANK Comes of Age: Monetary Policy with Heterogeneous Overlapping Generations(Revised)

12/19/2025 Federal Reserve Central banks

Bence Bardóczy, Ettore Savoia, and Mateo Velásquez-GiraldoWe study the transmission and distributional effects of monetary policy in an environment where consumption-saving choices reflect both precautionary motives and life-cycle considerations.

Trillions for War, Pennies for People: How Soaring Military Spending Fails Americans

12/19/2025 Ineteconomics Analysis

William Hartung and Ben Freeman, authors of Trillion Dollar War Machine, talk with INET’s Lynn Parramore about America’s runaway defense spending and its increasingly alarming human toll

The economics of natural capital

12/19/2025 European Central Bank Central banks

We develop a framework underscoring the importance of incorporating natural capital into growth models and policy discussions, recognizing its role as a productive input and as a sourceof enjoyment. Both firms and the government face the trade-off between exploitation and conservation and can (but do not have to) engage in costly conservation. Firms optimally conserve natural capital to support future production but underinvest compared to the social optimum. Public conservation complements private action, shifting focus from current consumption to future growth.

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