American Institute for Economic Research

The Daily Economy brings together top minds to keep you informed about what's happening in economics and why it matters. Follow for daily insights!

AIER was pleased to participate in a Harwood Graduate Colloquium on Public Choice with emerging scholars and faculty. We enjoyed thoughtful dialogue, meaningful exchange, and the development of new ideas in the field.

[bottle of hard-to-swallow pills] You don't actually have a personal Social Security "account," Congress can change your benefits at any time.

In the latest episode of Qualified Opinions, @veroderugy and @RominaBoccia explain social security's problems and opportunities, and why your own personal "lockbox" doesn't exist. aier.org/podcast/the-so…

Worth taking the time to read...

Listen to this clip from @DrPaulMueller, @thomas_savidge, and @Dave_Hebert on the latest episode of The Economist Next Door.

"Sometimes solving a major economic challenge does not require an elaborate new policy. It simply requires local governments to step aside."

This new book from @bradleybirzer will give you a better understanding of our nation's founding; how it was both radical and deeply rooted in inherited traditions.

Check out this @washingtonpost @PostOpinions op-ed on America's un-ending #housing problems by my @aier colleague @Econ_Goggles Julia R. Cartwright: washingtonpost.com/opinions/2026/…

Looking at the countries with the highest wealth per person, its clear that these are not just places where people consume more, they are places where more capital exists to build more. Wealth is what turns today’s production into tomorrow’s growth. It’s the accumulated surplus that gets reinvested into businesses, infrastructure, technology, and innovation. Without wealth accumulation, there is no sustained capital formation and no economic growth. #wealth #visualcapitalist #economicgrowth #EconGoggles

If you really want to understand the economics of the minimum wage, check out this clearsighted and concise @aier explainer by my colleague @peter_c_earle.

Read @peter_c_earle's explainer: The Economics of the Minimum Wage: Myths, Facts, and Consequences aier.org/article/the-ec…

Economic growth driven by innovation and productivity gains is a more sustainable way to reduce inequality than wage mandates.

Research by Kalenkoski (2024) indicates that minimum wage increases can lead to reduced employment opportunities for young, unskilled workers.

A comprehensive meta-analysis by Neumark and Shirley (2021) found that 79.3 percent of studies reported negative employment effects following minimum wage hikes, with the impact being more pronounced among teens, young adults, and less-educated workers.

That story makes intuitive sense. When labor costs increase, businesses have a harder time hiring workers. Does the data confirm that story?

It sounds simple: raise wages, help the poor. In reality, when labor costs spike, businesses (especially small ones with thin margins) often pivot by: 1) raising prices, 2) cutting benefits or bonuses, and 3) hiring fewer people.

Automation is also a constant threat. As human labor gets more expensive, automation becomes more cost-effective. Self-checkout kiosks and robotic fry cooks don’t ask for raises. This hits low-skilled workers the hardest, as their "starter jobs" vanish.

In addition to jobs being lost, the people who are lucky enough to have jobs are under additional pressure. To stay profitable, bosses often hire fewer people and expect the remaining crew to do more work, leading to burnout and fewer entry-level rungs on the career ladder.