The Digest

High-skill workers’ service demand plunged early in the pandemic as some relocated and others rarely left home. Drawn by shorter commutes and urban amenities, highly skilled, highly compensated workers in the information and management sectors moved to urban centers in recent decades, reviving cities and their service economies. As digital technologies spread, the capacity for working remotely expanded, but it was not widely utilized. That changed dramatically...

Multinational manufacturing enterprises that are better at monitoring and planning production are likely also more adept at shifting their profits to low-tax countries. Better management leads to higher profits, but among multinational manufacturers this is primarily true for their operations in low-tax countries. In high-tax countries, better management is often associated with lower profits. The reason, according to a new study, seems to be profit shifting....

Countries that are more likely to elect left-leaning governments face higher borrowing costs, on average, in global capital markets. Some nations are more likely to elect left-leaning central governments than others. In Sovereign Spreads and the Political Leaning of Nations (NBER Working Paper 29197), Ionut Cotoc, Alok Johri, and César Sosa-Padilla investigate the relationship between a country’s political composition and the interest rate on its sovereign debt...