When drugs are legal, private and public mechanisms for quality control (reputation, tort liability) limit the risk of accidental overdoses

See Marijuana versus Fentanyl by Jeffrey Miron and J. Glazer.

"The Trump administration recently initiated rulemaking to reschedule marijuana from Schedule I to Schedule III. Drugs in Schedule I are deemed to have no accepted medical purpose and high potential for abuse, while those in Schedule III (e.g., ketamine, anabolic steroids) are categorized as having “moderate to low potential for physical and psychological dependence.”

Opinions vary as to whether this rescheduling will have a major impact on the marijuana market, since Schedule III still gives the federal government considerable control. But the change unquestionably weakens federal marijuana prohibition.

A further question is why federal policy treats marijuana so differently than opioids like fentanyl. Conventional wisdom assumes that opioids are more dangerous than MJ and that stricter government control is desirable for more dangerous substances.

In fact, the right approach for all drugs is the same: legalization. The history of marijuana versus opioid policy supports this view.

Since the 1970s, U.S. marijuana policy has moved away from strict prohibition, starting with state-level decriminalization, medicalization, and legalization, followed now by partial federal relaxation. Despite debate over the effects of marijuana on psychological health, the evidence does not suggest that rescheduling would result in material increases in violence or other social harm. By contrast, policy toward fentanyl and other opioids has moved toward more aggressive prohibition and enforcement over the past several decades. During that period, opiate overdose deaths have soared.

This contrast highlights a core libertarian point. When drugs are legal, private and public mechanisms for quality control (reputation, tort liability) limit the risk of accidental overdoses. Under prohibition, these mechanisms do not operate, so quality control (e.g., accurate potency labels) declines. Similarly, under legalization, market participants resolve disagreements with non-violent mechanisms like courts and arbitration; under prohibition, they resort to violence.

The lesson from marijuana is therefore not that drugs are harmless but that criminal enforcement makes their harms worse. If policymakers are serious about reducing drug-related deaths and violence, the divergence between marijuana and opioid policy should give them pause."

The Middle Class Is Shrinking Because of a Booming Upper-Middle Class

By Stephen J. Rose & Scott Winship of AEI.

"Abstract

Populists on both the political left and right routinely claim that the middle class has been hollowed out. These claims, to the extent they are based on evidence, rely on a relative definition of the middle class, such that if income doubles for every family, the middle class does not grow. Using an absolute definition of the middle class, we find that the “core” middle class has shrunk, but only because more families have become upper-middle class over time. The upper-middle class boomed from 10 percent of families in 1979 to 31 percent in 2024, and its share of income doubled. The share of families whose income left them short of the core middle class fell from 54 percent to 35 percent. Claims of a hollowed-out middle class wrongly reinterpret widespread (if unequal) gains across the income distribution as rising insecurity and declining living standards."

On every continent, food supplies have grown faster than the population

By Pablo Rosado & Max Roser. 

"We just lived through the period with the fastest population growth in human history. Six decades ago, there were three billion people on our planet. Since 2022, there have been more than eight billion people — an increase of five billion over this period.

It would have been impressive if food supplies had merely kept pace with population growth. But as the chart above shows, they grew even faster. On every continent, food supplies — measured by calories — grew faster than the population. This rise in food production per person was a major reason for the decline of extreme poverty and hunger.

To us, this chart documents one of humanity’s most extraordinary achievements."

 

 

ObamaCare Is a Money Pit for Taxpayers

A new study shows extending subsidies would be reckless

By Ge Bai and Elizabeth Plummer. Ms. Bai is a professor of health policy and management at Johns Hopkins University. Ms. Plummer is a professor of accounting and medical education at Texas Christian University. Excerpts:

"In 2024 they paid nearly 80% of the premiums for subsidized plans—compared with only 30% in 2014."

"Taxpayers paid more than $114 billion directly to insurers in 2024—one-third more after inflation than in 2023, more than double the amount in 2020 (before the enhanced subsidies), and more than six times as much as in 2014."

"ObamaCare banned affordable insurance options and destroyed independent physician practices, damaging the insurance and provider markets. Consolidation, administrative bloat, high prices and soaring premiums followed."

"the correlation between premium growth and subsidy growth is nearly perfect."

"Subsidies are calculated so that the premiums paid by subsidy-eligible enrollees for benchmark plans fall within a set percentage of their income"

"In 2021 Congress expanded subsidy eligibility to higher-income households and lowered income caps for others"

"In 2024, 90% of subsidy-eligible enrollees had access to plans with net premiums of $10 a month or less."

"23 of 24 fictitious applications were approved for premium subsidies, and 18 were still covered a year later."

"the market size for unsubsidized ObamaCare plans shrank by a quarter, from $23 billion in 2014 to $17 billion in 2024."

Another Trump Tariff Retreat

This time it’s a delay for a year on higher taxes on upholstered furniture and kitchen cabinets

WSJ editorial. Excerpts:

"His planned 30% to 50% levies will now be delayed a year, maintaining a still damaging 25% border tax."

"Prices for living-room furnishings rose 4.6% in November from a year earlier"

"The retreat is another in a string of policy reversals to mute the tariff harm to American consumers."

"You’d think the tariff cheerleaders would be embarrassed by these walkbacks, but they ignore them as they promise that the tariff golden age will soon arrive."

Gavin Newsom Has a Wealth Tax Dilemma

The left is pushing a referendum that will force him to choose as he runs for President

WSJ editorial. Excerpts:

"The tax would be assessed on the shares in public companies at their market value as of Dec. 31, 2026. If share prices later decline, tough. Billionaires would have to pay tax on the “fair market value” of illiquid and intangible assets—e.g., private equity stakes, patents, artwork—based on a certified appraisal.

The only asset exceptions would be real estate, pensions and retirement accounts. Billionaires would likely have to liquidate stock holdings—and pay 13.3% state income tax on their capital gains—or borrow against assets to pay the wealth tax."

"The top 1% pay half of the state’s income tax." 

Mississippi’s Capitalist Awakening

An Englishman moves to Jackson to become the leader of a free-market think tank

By William McGurn. Excerpts:

"In 2024, according to the Commerce Department’s Bureau of Economic Analysis, the state registered 4.2% growth in real gross domestic product—making it the second-fastest-growing state in the U.S."

"some of the ingredients for Mississippi’s growth these past five years: a huge income-tax cut, with a 4% flat tax going into effect in 2026; deregulation that opens up occupational licensing to competition; a government that spends within its means, yielding budget surpluses; and low-cost energy, mainly a result of avoiding the renewable energy subsidies so popular in blue states." 

Tax Reformers, Get Out of the Wealthy’s Way

Private business owners are more generous than the most progressive of tax schedules

Letter to The WSJ. 

"Your editorial “By All Means Raise Mitt Romney’s Taxes” (Dec. 22) correctly stresses that the rich pay a disproportionate share of taxes. Mr. Romney still argues that people like him should pony up even more. This view is central to socialism and frequent among economists, such as Thomas Piketty, who seem confused about how markets work. They assume government has a monopoly on service, neglecting that private business owners are more generous than the most progressive of tax schedules.

In the private sector you can only sell things if you help others—that is, if customers benefit more than they pay. If you’d cough up $100 for being able to brush your teeth but a toothbrush costs $5, you benefit 20 times as much as the sticker price. That sum, what economists call “consumer surplus,” averaged across industries is about 95% of the social value created by a business. 

But this is only part of how company owners help others. On average 60% of sales are wages, the best welfare program invented. Put differently, 98% of the value of starting a risky business benefits others, presumably more than the “fair share” of the rich’s labor than even communists dare propose.

Many politicians nevertheless act as if the only help that matters is given through the public sector, with them as middlemen. Never mind that help to the poor is often reduced by taxing the rich—money that would have been administered more effectively via private donations. The 250 billionaires of the Giving Pledge, launched by Bill Gates and Warren Buffett, are donating half their fortunes—surely more helpful than a 50% wealth tax.

If reformers understood markets, they would get out of the way of the superrich who are benefiting the public and resist any disincentives to their generosity. Their contributions to others are reflected proportionally in their accumulated wealth.

Tomas J. Philipson

Chicago

Mr. Philipson was a member of the White House Council of Economic Advisers, 2017-20, and its acting chairman, 2019-20."

The Medical Case for Rescheduling Cannabis

Dr. Peter Grinspoon replies to the editorial board

Letter to The WSJ. 

"Your editorial “Trump Goes for the Stoner Vote” (Dec. 20) misses some important aspects of cannabis use in the U.S. Among them: There is no evidence that teenage use has risen with legalization. Dispensaries are extremely careful in checking identification, and smoking simply isn’t as cool when grandma is a taking a puff or two for her arthritis.

The medical review you cite, which claims “no medical benefit” to use, is one study among thousands. It was performed by researchers who, to my understanding, haven’t treated a single medical cannabis patient to alleviate symptoms. The doctors who directly help patients use cannabis have a different vantage. There is abundant evidence for the efficacy of medical cannabis for most, if not all, of the claims patients make. The 2017 report by the National Academies of Science, Engineering and Medicine concluded there was “conclusive” evidence of effectiveness in treating chronic pain and other conditions.

Cannabis doubtless has several potential harms, and certain people should stay away from it—e.g., teens, pregnant women, those with a history of psychosis. We don’t want an unregulated industry running amok, either, as we experienced with tobacco and alcohol. Yet cannabis is less dangerous than both substances—both of which are excluded from the Controlled Substance Act and contribute to hundreds of thousands of deaths per year. We shouldn’t treat cannabis any different.

As a physician, I suggest we primarily look at how we can reduce patients’ suffering. With education and careful regulation we can avoid or minimize many of the harms associated with cannabis use, which is already helping Americans with intractable chronic pain, nausea, anxiety and insomnia. A majority of Americans support legal access to medical cannabis—so a baby step in this direction, rescheduling cannabis into a less restrictive category, is a step in the right direction.

Dr. Peter Grinspoon

Harvard Medical School"

 

 

Everyone Got Tariffs Wrong? Not Economists

We’ve long acknowledged that their effect on prices is complicated

Letter to The WSJ. 

Economists never claimed that tariffs immediately or inevitably cause inflation (“Why Everyone Got Trump's Tariffs Wrong,” Page One, Dec. 16). We’ve long acknowledged that their effect on prices is complicated.

The first reason for that is the substitution effect: When tariffs raise the relative price of imports, consumers often shift their spending toward other goods. Some import prices may even fall, particularly if demand dries up. The net effect, then, is ambiguous.

The second factor is the income effect. Higher import costs give consumers less bang for their buck. If iPhone prices double because of tariffs, for instance, consumers enjoy less real income. Tighter budgets mean consumers have less to spend on other goods.

Moral of the story: If you’re looking solely at the inflation rate to see the effects of tariffs, you likely won’t find it. In a vacuum, the levies cause a one-time jump in an economy’s price level but not a continuous rise in its growth rate. What happens after that depends on how policymakers respond. In any case, tariffs’ most predictable and immediate effects are sputtering growth and declining consumer welfare.

Ask yourself: Doesn’t that resonate with your experience over the past nine months?

Scott Burns

Southeastern Louisiana University

Baton Rouge, La.

Caleb S. Fuller

Grove City College

Grove City, Pa."

 

 

 

A Tale of Two Medicaid States: Minnesota Fraud vs. Indiana Reform

More indictments in Tim Walz’s state, while Mike Braun’s reforms save hundreds of millions of dollars

WSJ editorial. Excerpts:

"fraud losses since 2018 could top $9 billion."

"two men in Philadelphia . . . registered as housing providers despite no connections in the state. Minnesota was the first state to let Medicaid funds be used for housing services for the disabled and recovering addicts. The defendants billed Medicaid for fake services."

"This is a pattern in the charges: Defendants set up sham companies, then submitted false claims."

"the home-care program “has been vulnerable to fraud,” as providers can bill the state for providing care up to 24 hours a day. Minnesota Medicaid spending on this in-home program surged to $170 million in 2024 from $4.6 million in 2021"

"The state’s Medicaid spending has increased by nearly two-thirds in six years."

"Medicaid spending nationwide has increased by some $380 billion since the beginning of the pandemic"

This "spurred Indiana Republicans this spring to impose reforms, including more rigorous eligibility checks and guardrails to prevent excessive billing."

"the state said it expects to save $466 million on Medicaid over the next two years compared to its spring projections. Medicaid enrollment has declined by some 11% thanks to eligibility checks."

"the 340B program, which lets hospitals and pharmacies they contract with buy drugs as steep discounts. They then charge insurers large markups when they administer the drugs to patients."  

The Minimum Wage Makes the Affordability Crisis Worse

Higher labor costs push prices up, while fewer jobs and hours mean less money in workers’ pockets

By Jason L. Riley. Excerpts:

"In a forthcoming academic paper, Mr. Strain and Jeffrey Clemens analyze changes to the minimum wage in the decade preceding the Covid pandemic. They conclude that large increases harmed employment prospects for people with limited skills and work history—the same group who have experienced the most erosion in purchasing power since the pandemic. The authors estimate that “relatively large increases in minimum wages reduced employment rates among individuals with low levels of experience and education by just over 2 and a half percentage points.”

Between 2011 and 2019, California, New York state and the District of Columbia lifted their wage floors by 50%, 53% and 61%, respectively. New York City’s minimum wage more than doubled between 2013 and 2020 and will rise to $17 an hour next year, 13% higher than in 2023. The biggest jump in 2026 will occur in Hawaii, where the minimum will rise by $2 to $16 an hour, a 14% increase."

"the lowest-paid workers tend to spend a larger share of their income on food, housing, medical care and other necessities, which makes them far more sensitive to price increases. Minimum-wage mandates can make their situation even more precarious. The minimum wage for fast-food workers rose to $20 an hour in California in 2024. The Journal reported that in anticipation of the increase, restaurants halted hiring and scaled back hours. Teenage unemployment in the Golden State was already about twice the national average." 

Britain Pushed Ahead With Green Power. Its Grid Can’t Handle It.

Aging power infrastructure threatens ability of U.K. and others to capitalize on AI boom

By Rebecca Feng of The WSJ. Excerpts:

"countries around the world have raced to install solar panels and wind turbines."

"aging electricity grids that can’t handle the power."

"In Europe, a sweeping blackout in Spain in April highlighted how big power swings can overwhelm the system."

"Britain built a vast network of wind and solar farms and generates a higher proportion of its power from renewables than most places in the world. But it didn’t build the transmission lines needed to move all that clean energy around."

"Grid upgrades and associated costs add to what are already some of the world’s most expensive electricity bills. The average-size British household paid almost $1,500 for electricity last year, more than double the bill in 2008, government data show."

"American households pay $1,700 each year for consuming three times as much."

"Wind farms off the coast of Scotland are far from customers in the populated south, and leaving them constantly on risks frying the grid. The U.K. paid power generators $2.3 billion in the year to March to not produce electricity"

"a lot of wind farms are in Scotland, meaning the region generates far more power than it requires and needs to transmit some south, where most of the demand is. The current infrastructure isn’t sufficient to transport all that power." 

"The output from new solar panels and wind turbines depends on the weather, which doesn’t always align with demand. In the past, the grid operator could coordinate with coal-fired power plants to increase output when it knew Britons would return home from work and start turning on lights and TVs."

"Building a new transmission line can take up to a decade" 

Rich People Won’t Just Sit Still While You Tax Them

Higher taxes motivate the wealthy to move out of state and take their job-providing, revenue-creating businesses with them.

By Andrew Wilford of The National Taxpayers Union Foundation.

"As New York City Mayor-elect Zohran Mamdani prepares to take office, tax-happy progressive groups are eager to let you know that the idea that rich people move because of taxes is all a big myth. There are no consequences to raising taxes on rich people, they argue, because rich people will be rich no matter what. 

It’s a pretty picture, and a convenient one for those who have never met anything economically productive that they didn’t want to tax. The only problem is that the data proves it just isn’t true.

The latest media blitz comes in response to Mamdani’s campaign proposals to raise the income tax rate for top earners in the city from 3.9 percent to 5.9 percent. That’s in addition to statewide rates, which currently run as high as 10.9 percent. That means that, under Mamdani’s proposal, the wealthiest Big Apple residents would face state and local income taxes as high as 16.8 percent, even before federal taxes.

But never fear, say progressive groups such as Patriotic Millionaires — Zohran can tax to his heart’s content without fear of millionaire tax flight. They attempt to fortify their claims with research by the Center for Budget and Policy Priorities and tax-happy academics who make points that are technically true, yet entirely miss the point.

For instance, Patriotic Millionaires cites data showing that the millionaire population in New York grew in the wake of recent tax increases on the wealthy at the state level. But of course it did — the population of millionaires is constantly growing across the country due to economic growth and inflation. The more important thing, as the New York-based Empire Center shows, is that New York’s share of the nationwide millionaire population has dropped precipitously in recent years, from 12.7 percent in 2010 to 8.7 percent in 2022.

Others point to a spike in sales in the New York City luxury real estate market to suggest that “there is no Mamdani effect.” But that actually is an indication of the ongoing exodus, not a rebuttal. The New York City housing market has such a severe shortage of housing that when some wealthy New Yorkers pack up and leave, it’s no surprise that remaining millionaires snap up those luxury properties quickly. It’s no coincidence that inquiries from New Yorkers to the Miami Beach Ritz-Carlton for beachfront penthouses worth $10 million or more nearly tripled in the wake of Mamdani’s election.

Looking at the impact of net migration, the highest-tax states lose big among the wealthy every year. In the most recent IRS data, New York lost the second-most wealthy residents (shocker: California lost the most). On the other hand, Florida gained the most new wealthy residents from other states, followed by Texas.

If pressed further, progressive tax advocates may fall back on another true yet ultimately irrelevant point: that specific tax increases, generally speaking, raise more money than they lose in tax flight. And, indeed, Zohran’s two-percent income tax surcharge would likely leave the city with more revenue in the short term. But the cost comes in the long term, and has been coming for spending-addicted cities and states for some time. 

The National Taxpayers Union Foundation estimates that New York will have $3.8 billion less tax revenue to work with at both the state and local levels in 2025 because of out-migration. New York and New York City are losing that revenue year after year, shrinking the tax base and making future spending binges even harder to finance. 

As the cash cows in the top income brackets leave for greener pastures, there are only two options for politicians who treat the idea of “reining in spending” as an odd foreign custom. One is to increase taxes further on the wealthier New Yorkers who are left, which only exacerbates the problem. The other is to start to shift more and more of that tax burden onto the middle class.  

And guess what? A lot of those wealthy emigrants take their businesses — employers who provide jobs and pay a lot of tax revenue — with them. No state is losing firms to other states faster than New York. 

Even long-time New York City staples are looking elsewhere, as Mamdani’s election has managed to accelerate the already exploding growth of the Dallas counterpart to Wall Street (affectionately known as “Y’all Street”). Big names such as Goldman Sachs and JPMorgan Chase continue to shift more and more of their operations to the Lone Star state, and Texas now boasts more jobs in the financial services sector than New York does.

Progressives should not stick their heads in the sand about the consequences of their policies. Many wealthy New Yorkers will choose to stay after yet another tax hike from Mayor Mamdani, and some of those will stay after the next tax hike as well. But with death by a thousand cuts, it’s the steady bleeding that kills you."

Why Some US Indian Reservations Prosper While Others Struggle

From Alex Tabarrok.

"Our colleague Thomas Stratmann writes about the political economy of Indian reservations in his excellent Substack Rules and Results.

Across 123 tribal nations in the lower 48 states, median household income for Native American residents ranges from roughly $20,000 to over $130,000—a sixfold difference. Some reservations have household incomes comparable to middle-class America. Others face persistent poverty.

Why?

The common assumption: casino revenue. The data show otherwise. Gaming, natural resources, and location explain some variation. But they don’t explain most of it. What does? Institutional quality.

The Reservation Economic Freedom Index 2.0 measures how property rights, regulatory clarity, governance, and economic freedom vary across tribal nations. The correlation with prosperity is clear, consistent, and statistically significant. A 1-point improvement in REFI—on a 0-to-13 scale—correlates with approximately $1,800 higher median household income. A 10-point improvement? Nearly $18,000 more per household.

Many low-REFI features aren’t tribal choices—they’re federal impositions. Trust status prevents land from being used as collateral. Overlapping federal-state-tribal jurisdiction creates regulatory uncertainty. BIA approval requirements add months or years to routine transactions. Complex jurisdictional frameworks can deter investment when the rules governing business activity, dispute resolution, and enforcement remain unclear.

This is an important research program. In addition to potentially improving the lives of native Americans, the 123 tribal nations are a new and interesting dataset to study institutions.

See the post for more details amd discussion of causality. A longer paper is here."

Mitt Romney’s Case for Higher Social Security Taxes

By David R Henderson. Excerpt:

"Romney does advocate one particular tax increase that I’m deadset against. He writes:

I have long opposed increasing the income level on which FICA employment taxes are applied (this year, the cap is $176,100). No longer; the consequences of the cliff have changed my mind.

Notice that this isn't a tax on wealth. It’s a tax on income.

His basic argument is the Willie Sutton explanation for why he robbed banks: “That’s where the money is.”

But Romney doesn’t consider two things: (1) whether increasing that tax threshold is fair, and (2) what would be the consequences for the economy.

First, it’s not fair. Social Security is a bad deal for higher income people. They already get very little additional benefit for the additional taxes they pay. Raising the threshold would make that worse. I don’t say this as someone who would be directly hurt. It’s true that I still pay Social Security on my net business income. But that income is well below half of the current threshold and so I would likely never be affected directly. Rather, I say this as someone who thinks high-income people don’t suddenly lose their right to be treated fairly simply because they are high-income.

Second, raising the threshold would suddenly subject a lot of higher-income people to dramatically higher marginal tax rates. Romney doesn’t specify a threshold, but let’s speculate that he advocates raising it to $200,000. There are probably a few million US residents currently making between $176,000 and $200,000 annually. If they were self-employed, they would suddenly be paying a tax rate that is 12.4 percentage points higher than what they have been paying. If they are married and have earning spouses, they are probably in a 22% or 24% federal tax bracket. They also pay a 2.9% tax rate for Medicare. If they are in a state with an income tax, they probably pay a marginal tax rate of at least 4%.

So add up their current marginal tax rates, assuming the 24% federal rate, and you get 24 + 2.9 + 4 = 30.9 percent. That’s bad but not horrible. But then add the 12.4 percentage points and you get a total marginal tax rate of 43.3%."

Tax progressivity and output in the US

By João Tovar Jalles & Georgios Karras.

Highlights

• •
  We use a novel data set on US tax progressivity constructed by Borella et al. (2022).
• •
  We estimate its output effects in the US since 1970.
• •
  Tax progressivity reduces growth temporarily and the level of income per capita permanently.
• •
  Results are robust to controlling for changes in the tax rate.

Abstract

Compared to the economic effects of tax rates, those of tax progressivity have benefited much less from the recent Renaissance in fiscal research. In this letter, we use a novel data set on US tax progressivity constructed by Borella et al. (2022) to estimate its output effects since 1970. Our results show that tax progressivity reduces the economy's growth rate temporarily and the level of income per capita permanently. Both effects are sizable, statistically significant, and robust to various specifications and to controlling for changes in the tax rate.

Economic inequality does not equate to poor well-being or mental health

From Nature. 

"A meta-analysis of 168 studies covering more than 11 million people found no reliable link between economic inequality and well-being or mental health. In other words, living in a place that has large gaps between the rich and poor does not affect these outcomes, with implications for policy."

Also see No meta-analytical effect of economic inequality on well-being or mental health by Nicolas Sommet, Adrien A. Fillon, Ocyna Rudmann, Alfredo Rossi Saldanha Cunha & Annahita Ehsan. From Nature.

"Abstract

Exposure to economic inequality is widely thought to erode subjective well-being and mental health^1,2,3,4,5, which carries important societal implications^6,7,8,9,10. However, existing studies face reproducibility issues^11,12,13, and theory suggests that inequality only affects individuals in disadvantaged contexts^14,15,16. Here we present a meta-analysis of 168 studies using multilevel data (11,389,871 participants from 38,335 geographical units) identified across 10 bibliographical databases (2000–2022). Contrary to popular narratives, random-effects models showed that individuals in more unequal areas do not report lower subjective well-being (standardized odds ratio (OR_+0.05) = 0.979, 95% confidence interval = 0.951–1.008). Moreover, although inequality initially seemed to undermine mental health, the publication-bias-corrected association was null (OR_+0.05 = 1.019; 0.990–1.049)¹⁷. Meta-analytical effects were smaller than the smallest effect of interest, and specification curve analyses confirmed these results across ≈95% of 768 alternative models¹⁸. When assessing study quality and certainty of evidence using ROBINS-E and GRADE criteria, ROBINS-E rated 80% of studies at high risk of bias, and GRADE assigned greater certainty to the null effects than to the negative effects. Meta-regressions revealed that the adverse association between inequality and mental health was confined to low-income samples. Moreover, machine-learning analyses¹⁹ indicated that the association with well-being was negative in high-inflation contexts but positive in low-inflation contexts. These moderation effects were replicated using Gallup World Poll data (up to 2 million participants). These findings challenge the view that economic inequality universally harms psychological health and can inform public health policy."

Timothy Taylor has a longer excerpt.