Arin Dube
@arindube.bsky.social
Provost Prof. of Economics (UMass Amherst).
Inequality, labor market policies and competition.
Affiliations: NBER, IZA, MIT Shaping the Future of Work Initiative
Preorder my book, The Wage Standard: https://www.thewagestandard.com
Inequality, labor market policies and competition.
Affiliations: NBER, IZA, MIT Shaping the Future of Work Initiative
Preorder my book, The Wage Standard: https://www.thewagestandard.com
Pinned
Arin Dube
@arindube.bsky.social
· Dec 10
Very excited to see The Wage Standard in The Next Big Idea Club's Must Read Books list!
When R2 asks you to do those robustness checks you really don't want to do, just replying "The Dow is over $50,000!" is always an option.
February 12, 2026 at 3:01 AM
When R2 asks you to do those robustness checks you really don't want to do, just replying "The Dow is over $50,000!" is always an option.
In forecasting the future of AI, it's easy to miss the main point.
Whether AI largely substitutes or complements human capabilities isn't merely a technological matter.
It's a societal choice.
Whether AI largely substitutes or complements human capabilities isn't merely a technological matter.
It's a societal choice.
February 8, 2026 at 5:44 PM
In forecasting the future of AI, it's easy to miss the main point.
Whether AI largely substitutes or complements human capabilities isn't merely a technological matter.
It's a societal choice.
Whether AI largely substitutes or complements human capabilities isn't merely a technological matter.
It's a societal choice.
Twitter/X is not real life, apparently.
February 5, 2026 at 4:46 PM
Twitter/X is not real life, apparently.
It's a statement about relative price changes.
Restaurant meal prices have risen more than prices of food at home - so restaurant meals have become relatively more expensive.
Restaurant meal prices have risen more than prices of food at home - so restaurant meals have become relatively more expensive.
February 3, 2026 at 4:50 AM
It's a statement about relative price changes.
Restaurant meal prices have risen more than prices of food at home - so restaurant meals have become relatively more expensive.
Restaurant meal prices have risen more than prices of food at home - so restaurant meals have become relatively more expensive.
It's a statement about relative price changes
Restaurant meal prices have risen more than prices of food at home - so restaurant meals have become relatively more expensive.
Restaurant meal prices have risen more than prices of food at home - so restaurant meals have become relatively more expensive.
February 3, 2026 at 4:49 AM
It's a statement about relative price changes
Restaurant meal prices have risen more than prices of food at home - so restaurant meals have become relatively more expensive.
Restaurant meal prices have risen more than prices of food at home - so restaurant meals have become relatively more expensive.
The DoorDash discourse is missing the bigger picture: restaurant meals have become more expensive than preparing food at home, and guess what? People are are eating less restaurant meals (whether takeout or going out) and preparing more food at home.
Especially poorer and younger folk.
Especially poorer and younger folk.
February 3, 2026 at 3:19 AM
The DoorDash discourse is missing the bigger picture: restaurant meals have become more expensive than preparing food at home, and guess what? People are are eating less restaurant meals (whether takeout or going out) and preparing more food at home.
Especially poorer and younger folk.
Especially poorer and younger folk.
We can learn a lot from Moltbook - by reading how people react to a simulacrum
January 31, 2026 at 1:03 PM
We can learn a lot from Moltbook - by reading how people react to a simulacrum
37 year old ICU nurse shot to death in a brazen act of state terror.
January 24, 2026 at 11:25 PM
37 year old ICU nurse shot to death in a brazen act of state terror.
We will remember Alex Pretti.
We will remember Renee Good.
January 24, 2026 at 11:21 PM
We will remember Alex Pretti.
Reposted by Arin Dube
This
The TACO cycle:
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
January 22, 2026 at 1:15 AM
This
Reposted by Arin Dube
💯 accurate description.
The TACO cycle:
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
January 21, 2026 at 8:14 PM
💯 accurate description.
Breaking: Econometrica is now accepting "Framework of a paper" submissions
January 22, 2026 at 12:26 AM
Breaking: Econometrica is now accepting "Framework of a paper" submissions
Reposted by Arin Dube
The Lucas Cri-taco?
The TACO cycle:
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
January 21, 2026 at 11:09 PM
The Lucas Cri-taco?
Fundamentally, the problem is TACO undermines itself over time.
January 21, 2026 at 8:13 PM
Fundamentally, the problem is TACO undermines itself over time.
Reposted by Arin Dube
How markets factor in Trump came up in the Fed firing oral argument today at SCOTUS. SG pointed to lack of market reaction to Cook's firing as a reason why the impact is not so bad, but no discussion of whether market assumed courts would intervene, and so on.
The TACO cycle:
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
January 21, 2026 at 8:05 PM
How markets factor in Trump came up in the Fed firing oral argument today at SCOTUS. SG pointed to lack of market reaction to Cook's firing as a reason why the impact is not so bad, but no discussion of whether market assumed courts would intervene, and so on.
Here’s the really bad part: over time, this dynamic breeds bigger and bigger crises.
Markets keep updating their beliefs about TACO, so it takes ever more extreme actions to convince them he might not TACO.
Buckle up.
Markets keep updating their beliefs about TACO, so it takes ever more extreme actions to convince them he might not TACO.
Buckle up.
January 21, 2026 at 7:59 PM
Here’s the really bad part: over time, this dynamic breeds bigger and bigger crises.
Markets keep updating their beliefs about TACO, so it takes ever more extreme actions to convince them he might not TACO.
Buckle up.
Markets keep updating their beliefs about TACO, so it takes ever more extreme actions to convince them he might not TACO.
Buckle up.
Reposted by Arin Dube
The single best theory of the last few months
The TACO cycle:
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
January 21, 2026 at 7:50 PM
The single best theory of the last few months
The TACO cycle:
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
January 21, 2026 at 7:48 PM
The TACO cycle:
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
Markets want to price in TACO. But TACO only works if Trump sees stocks tank.
So we get a loop: Trump does things → nothing happens (markets already priced in TACO) → that emboldens him to do more → until markets start to think he might not TACO → stocks fall → TACO is restored.
I really don't know what you mean, perhaps in no small part because I have never known any policy agenda to feel ever-present in any moment...
January 21, 2026 at 4:01 AM
I really don't know what you mean, perhaps in no small part because I have never known any policy agenda to feel ever-present in any moment...
That would (at least in the short term) lead to a worsening of the downturn.
Of course, none of this may happen. (I hope it doesn't!) But I see these as very plausible scenarios.
Of course, none of this may happen. (I hope it doesn't!) But I see these as very plausible scenarios.
January 21, 2026 at 3:45 AM
That would (at least in the short term) lead to a worsening of the downturn.
Of course, none of this may happen. (I hope it doesn't!) But I see these as very plausible scenarios.
Of course, none of this may happen. (I hope it doesn't!) But I see these as very plausible scenarios.
The add-on risk is macro-economic. Given the importance of AI cap-ex in holding up spending, a sharp reduction in AI asset prices will likely cause a major reduction in spending.
Our current political economy is probably tilted against providing necessary fiscal stimulus.
Our current political economy is probably tilted against providing necessary fiscal stimulus.
January 21, 2026 at 3:44 AM
The add-on risk is macro-economic. Given the importance of AI cap-ex in holding up spending, a sharp reduction in AI asset prices will likely cause a major reduction in spending.
Our current political economy is probably tilted against providing necessary fiscal stimulus.
Our current political economy is probably tilted against providing necessary fiscal stimulus.
Think 30%+ in the S&P 500 ... sometime in 2026.
I'm not in the business of forecasting asset prices (no one really is, if they're honest). But these risks feel very real.
I'm not in the business of forecasting asset prices (no one really is, if they're honest). But these risks feel very real.
January 21, 2026 at 3:44 AM
Think 30%+ in the S&P 500 ... sometime in 2026.
I'm not in the business of forecasting asset prices (no one really is, if they're honest). But these risks feel very real.
I'm not in the business of forecasting asset prices (no one really is, if they're honest). But these risks feel very real.
Right now, the most likely source of that kind of shock (and not unrelated to tech valuation) is political economy: Trump's trade and military choices.
Layer that on top of possibly finding weaker-than-expected AI earnings, and you can get to a major drawdown.
Layer that on top of possibly finding weaker-than-expected AI earnings, and you can get to a major drawdown.
January 21, 2026 at 3:43 AM
Right now, the most likely source of that kind of shock (and not unrelated to tech valuation) is political economy: Trump's trade and military choices.
Layer that on top of possibly finding weaker-than-expected AI earnings, and you can get to a major drawdown.
Layer that on top of possibly finding weaker-than-expected AI earnings, and you can get to a major drawdown.