Dear reader,

Innovation, economic resilience, and the impact of policy decisions shape our future. This edition brings you new insights on how wages drive automation, the role of AI in shaping democracy, and exciting research on cognitive training. We also celebrate Dina Pomeranz’s appointment and invite you to upcoming events.

Sincere regards,

Ernst Fehr, Director
Hans-Joachim Voth, Scientific Director

New evidence on the wage-innovation link

Do firms innovate more in automation when wages rise? A new study by David Hémous and co-authors confirms this widely held theory. By analyzing automation patents and wage data across 41 countries, they find that higher wages encourage firms to develop automation technologies, while lower wages slow innovation. The findings highlight how labor policies shape long-term technological progress, with broader implications for economic growth and job markets.

Long-term benefits of cognitive training in early education

Can working-memory training improve children’s cognitive and academic skills? A study by Ernst Fehr and co-authors shows that early interventions significantly enhance IQ, math abilities, and self-control. Three years later, children who received the training were far more likely to enter advanced secondary schools. The research underscores the long-term benefits of cognitive training in early education.

Dina Pomeranz appointed as Associate Professor

We warmly congratulate Dina Pomeranz on her appointment as Associate Professor ad personam at the University of Zurich. As a leading researcher in public finance and taxation, she has worked closely with policymakers in Chile, Ecuador, and Kenya to improve economic governance. Dina has been recognized as one of Switzerland’s most influential economists and continues to bridge research with policy impact.