And the Oscar for Economics Goes To... (2/2)
What can the 2025 Oscar nominees tell us about the economy?
So, as you might know, I like movies, and the Oscars were around a week ago. Last year, and now this one, I’ve been posting a small economics roundup for the Best Picture nominees. Because there are ten movies nominated this year, I did two parts, with part one coming on Oscars night itself. This is part two. Instead of looking at every single nominee and doing a deep-dive of the economics thereof, I had a different idea: look at most of them, and do a briefer take on some economic concept related to them.
As a general rule, the post contains spoilers for the relevant movies: Dune: Part Two, I’m Still Here, Wicked, The Substance, and Nickel Boys.
Dune: Part Two - Power over spice is power over all
Dune: Part Two is, well, the second part of the Dune adaptation trilogy (adapting both Dune the book and Dune: Messiah, the sequel), and it follows Paul Atreides, a young nobleman from an important family in the space aristocracy (it’s a whole thing), whose family falls from grace and is wiped out by the Emperor. With his mother’s help (especially her role in religion), Paul manages to take over the spice-producing planet Arrakis and challenge the Emperor for the throne, and also convince the people of Arrakis (the Fremen) that he’s their Messiah so they can do a jihad (it’s literally called that) against everyone who’s against him. Spice is a big deal because it’s like the petroleum of Dune and it’s used to power spaceships (and get high). To quote Veep, “Jesus, I can feel my virginity growing back in here.”
So, what can we make economically of Dune: Part Two? Of course, since Dune is about space (and worms), and spice is the stuff that powers space travel, then it deserves a closer look on its own. Paul Krugman’s “The Theory of Interstellar Trade” (1978) remains the most important paper in the field. Fundamentally, economists consider that trade flows are driven by the principle of comparative advantage (i.e. that countries should export what they can make better than their partners, and import what their partners do better than them), and descriptively, consider that trade works a lot like gravity: distance between trading partners reduces flows, but the size of their economies increase them. This explains both international and interplanetary trade, but not interstellar trade, due to general relativity: to travel within or between star systems, spaceships would need to go close to light speed (I don’t remember and don’t espeically care how Dune works around this), but light speed involves a singificantly slowed passage of time for very complicated reasons, so calculating interest rates would be kinda difficult. but basically it all works out because time dilation is a known process, mathematically.
In addition, development economist Mark Koyama has a paper about it (and Dune part one and Dune part 3) titled “Frank Herbert's Dune” (2023), which he summarizes here. The setting of Arrakis is interesting: it’s a country that is rich in natural resources (spice), and advanced in technology, but its inhabitants are dirt (well, sand) poor. This is similar to what Stanley Engerman and Kenneth Sokoloff explained in their 2003 study “Institutions, Factor Endowments, and Paths of Development in the New World”, which looks at the “resource curse” for post-colonial societies: basically, countries with mineral and “plantation” wealth had much worse outcomes from European colonization, since extractive activities like gold mining and sugar planting concentrated wealth in the planter/settler class, who became an entrenched political elite and weakened future democratic governance, if they even allowed it in the first place. Koyama’s case, via Malthus and Dune author Frank Herbert’s influences, is that ownership of spice is not just concentrated in a small class (the ruling family of the Duke of Arrakis, Leto Atreides), but largely taken out of the planet: the paper “The Profitabality of Colonialism” (1993) by Herschel Grossman & Murat Iyigun examines whether colonialism would be profitable, and why, and finds that since resource use is determined by the colonizer to maximize their own profit, and not to maximize output and social wellbeing, then labor and resources will be poorly allocated and earnings will be concentrated on the “settler” elite - in this case, the Imperium. However, the Atreides family remaining on top even after losing their chokehold on Arrakis is realistic: the paper “The Intergenerational Effects of a Large Wealth Shock: White Southerners After the Civil War” (2019) by Philipp Ager, Leah Platt Boustan & Katherine Eriksson concludes that, after the US Civil War, slaveowners in the former Confederacy suffered a large decline in their wealth due to the loss of “slave assets”, but regained their wealth and position in the elite within two generations - largely due to social capital and networks accumulated before the War with other wealthy elites within and outside the planter elite.
A major part of Paul’s stratospheric rise to power in Arrakis is his appeal to the Fremen in religious terms. Glory being able to inspire that level of fanatical devotion is not new: in “Killer Incentives: Status Competition and Pilot Performance during World War II” (2017) by Philipp Ager, Leonardo Bursztyn & Hans-Joachim Voth studies how status and recognition inspires performance - in particular, among German pilots in World War Two. When a pilot’s “victory” score was mentioned by the Reichswehr bulletin, this pilot’s peers performed better, particularly driven by average-performing pilots taking more risks to secure status. So Paul’s campaign to secure the loyalty of the Fremen via glory works - and has particular religious implications, since the similarity of Fremen culture to Islamic culture can explain why. In “Trade and Geography in the Origins and Spread of Islam” (2017) by Stelios Michalopoulos, Alireza Naghavi & Giovanni Prarolo, the authors explain how Islam spread in the Old World (Europe, Asia and the Sahel): particularly that trade relations with the Persian Gulf “ground zero”1 fostered the spread of Islamic belief - particularly through trade preferences between Muslims over (insert Islamic term for “gentile” here). This is particularly driven by geography - specifically desert landscapes compared to fertile ones; the link here is that Islam is highly redistributive, and therefore the fertile regions traded some of their economic surplus with the desert “raiders” in exchange for peace and security, secured through religious ties. This is explored further in “Islam, Inequality and Pre-Industrial Comparative Development” (2015) by the same authors, who note that the unequal distribution of resources and fertile land made it economically beneficial to create a system of redistribution of the benefits of fertile regions to arid ones, in exchange for security - but with dire economic consequences. This dynamic mirrors how the Fremen (highly skilled warriors from a desert planet) were united by religious considerations behind Paul, who led them to war against more fertile planets like Caladan (the Atreides homeland) and who would secure the throne of the Imperium by military action.
I’m Still Here - Everybody’s in danger
I’m Still Here by Walter Salles is a Brazilian movie and the only Best Picture nominee I haven’t seen yet, but it looks pretty dope. It follows Eunice Paiva, an upper middle class housewife, after her politician husband Rubens is “disappeared” (extrajudicially arrested, tortured, and murdered) by the military junta. The movie documents Eunice’s search for her husband during both the junta’s reign and after the return of democracy, and deals with topics of loss, family, and political violence.
Rubens, being a congressman for a left-wing party2 was a prime candidate for political violence and repression. In “The Price of Political Opposition: Evidence from Venezuela's Maisanta” (2009), authors Chang-Tai Hsieh, Edward Miguel, Daniel Ortega & Francisco Rodriguez study whether being included in a list of several million voters who petitioned to remove Venezuelan dictator Hugo Chávez3 from office affected employment and income for those identified as regime opponents. Individuals publicly named as anti-chavistas saw a drop of 5% in their income and 1.5 percentage points less in employment rates, indicating that retaliation was swift and significant - and, therefore, that being identified as an opponent of a military junta probably carries similar, if not worse, consequences. In this vein, “A Theory of Military Dictatorships” (2008) by Daron Acemoglu, Davide Ticchi & Andrea Vindigni can provide indication of how juntas operate: in particular, since violent political repression is necessary for a military junta’s takeover of the government, it could very well find itself on the opposite side to economic elites, who fear such repression being imposed on them. Particularly, high-inequality societies such as Brazil are more likely to develop authoritiarian regimes, since the targets for violence are plenty and the elites are far smaller. This is examined in “Political Power, Elite Control, and Long-Run Development: Evidence from Brazil” (2020) by Claudio Ferraz, Frederico Finan & Monica Martinez-Bravo, which finds that the juntas in Brazil did benefit more politically concentrated regions: municipalities with single-family dominance in politics were richer in 2000 than before the 1964 coup, the opposite than to the relationship before the coup, since the military aimed to weaken their local allies by strengthening competition at the municipal level - which produced better outcomes for governance. Likewise, the paper “The Value of Democracy: Evidence from Road Building in Kenya” (2013) by Robin Burgess et al., studies a similar trend: whether democratization under similar authorities changed the degree to which the authority’s ethnicity distorted resource allocation - and find that it did, therefore pointing to a key dynamic of decisionmaking in dictatorial regimes: political survival via payoff.
Lastly, the movie does actually capture accurately the dynamics of families where one of the two parent figures dies - stress, financial strain, and hard work. In “Children, Unhappiness and Family Finances: Evidence from One Million Europeans” (2019) by David Blanchflower & Andrew Clark, the authors study one million Europeans (I mean, that’s the title) and evaluate the relationship between childrearing and parental wellbeing; among other results, they find that children reduce wellbeing mostly through financial channels (that is, by the cost of raising them) and raise happiness for parents after considering them - except for those who are divorced or widowed, who suffer a loss of wellbeing. Likewise, “Family Labor Supply Responses to Severe Health Shocks” (2017) by Itzik Fadlon & Torben Heien Nielsen finds that, if a spouse dies of a fatal heart condition, the other spouse is 11% more likely to participate in the labor market if the family does not have the means to sustain itself - both for men and for women, such as Eunice.
Wicked - No one mourns the wicked
Wicked is kinda meh, but a solid watch. The movie follows in bafflingly non-chronological order the relationship between Glinda, the Good Witch, and Elphaba, the Wicked Witch, when they’re in college together sometime before the events of The Wizard of Oz. In a very “it’s about the person the toy is based on” way, the movie is an adaptation of a musical that is a prequel to the book, not the movie.
The general dynamic of Shiz University (yes that’s the real name) is that it’s a very prestigious college that accepts the cream of the crop of Oz and propels them to positions of great power and importance - Elphaba goes straight to working for The Wizard given her magical abilities. This is a dynamic well captured in “Diversifying Society’s Leaders? The Determinants and Causal Effects of Admission to Highly Selective Private Colleges” (2023) by Raj Chetty, David Deming and John N. Friedman, finding that children from high income families are twice as likely to attend highly prestigious and exclusive schools (called Ivy League Plus schools: the Ivy League plus Stanford, MIT, Duke, and U. of Chicago), and that attending those schools results in significant benefits versus another similarly rigorous and exclusive but slightly less prestigious college: it increases your chances of being in the top 1% of incomes by 60%, doubles your chances of a prestigious grad school placement, and triples your shot at a prestigious post-college career. To quote a character in Bojack Horseman “Of course he was going to beat me. He went to Dartmouth! Where’s the candidate for regular schmoes like me, who went to Northwestern. Likewise, in “Old Boys' Clubs and Upward Mobility Among the Educational Elite” (2021) by Valerie Michelman, Joseph Price & Seth D. Zimmerman, the authors find that memberships in exclusive clubs (closed member societies like fraternities and clubs) raised incomes by 32% for Harvard graudates starting in the 1920s and 1930s, and that these results accrue at higher rates for students from advantaged backgrounds. Another related paper, “The Determinants of Income Segregation and Intergenerational Mobility: Using Test Scores to Measure Undermatching” (2020) by Chetty, Friedman, Emmanuel Saez, Nicholas Turner and Danny Yagan, looks at a similar dataset of college students and parental income, and finds that the relationship in question is more or less the same: holding fixed geographical and racial composition, the authors study how relying exclusively on standardized testing (considered a proxy for academic ability) would decrease income-based segregation, but by increasing the number of middle class students, since the number of low-income students with sufficiently high scores is sparse. This would also improve intergenerational mobility but, once again, only for the middle class. Outside of elite colleges, the effects are more broad-based, but for improvements in income diversity at top institutions, some sort of sliding scale for lower income students would need to be implemented. And lastly, a recent paper titled “How Test Optional Policies in College Admissions Disproportionately Harm High Achieving Applicants from Disadvantaged Backgrounds” (2025) by Bruce Sacerdote, Douglas Staiger & Michele Tine finds that switching from test-mmandatory to test-optional admissions in elite colleges hurts less advantaged (by income, race, or class) applicants since scores are the strongest part of their application, and things like essays and extracurriculars are weaker and highly correlated to family background. So Elphaba, being a disadvantaged racial minority (green) being able to achieve admission to Shiz and then rising stratospherically through the ranks is realistic. Similarly, Elphie’s highly effective mentorship by Madame Morrible is also accurate: according to “Teacher-directed scientific change: The case of the English Scientific Revolution” by Julius Koschnick (2025), students during the British Industrial Revolution in the 1680s were highly influenced by the research of their professors: analyzing the titles of student’s and teacher’s research with AI, the author finds that a 5% increase in professor interest in certain topics could increase student interest by as much as 13%.
A major factor in the movie’s plot is that Elphaba and Glinda are rivals, but later become friends, with the later introducing Elphie to “being popular” as key to her success in life. According to “The Growing Importance of Social Skills in the Labor Market” by David Deming (2017), this is true: the US labor market increasingly rewards social skills, to the point that jobs requiring high levels of social interaction grew by nearly 12% as a share of employment, and commanded a significantly higher wage premium between the 1980s and the 2010s. Likewise, according to “Party On: The Labor Market Returns to Social Networks in Adolescence” (2023) by Adriana Lleras-Muney, Matthew Miller, Shuyang Sheng & Veronica Sovero, while the returns to schooling are between 5% and 15% to income, the returns to being popular in high school are between 7% and 14% after controlling for schooling, meaning that popular kids get an even bigger bump to earnings. Similarly, the paper “Popularity” (2012) by Gabriella Conti, Andrea Galeotti, Gerrit Mueller & Stephen Pudney finds that moving from the least friendly 20% of students (in terms of self-reported number of friends) to most friendly 20% in high-school results in a 10% wage premium up to 40 years later. Lasstly, the paper “From Ties to Gains? Evidence on Connectedness and Human Capital Acquisition” by Phillip Babcock (2008) studies the impact of popularity on earnings and success, and finds that having a larger and stronger friend group in high school is correlated with higher earnings and higher chance of attending college. In a different vein, the study “Social Networks and Labor Markets: How Strong Ties Relate to Job Transmission On Facebook’s Social Network” (2022) by Laura K. Gee, Jason Jones, and Moira Burke finds that having more connections on Facebook improves chances during job search, particularly for weaker and more distant social ties. Likewise, the paper “Social Capital I: Measurement and Associations with Economic Mobility” (2022) by Chetty et al. finds that interclass friendships raise socioeconomic mobility and socioeconomic outcomes, as evidenced through Facebook friend networks. So Glinda’s friendship with and recommendations to Elphaba were clearly a good idea, beneficial to both of them, and also just plain nice (and, let’s be honest, kinda gay).
The Substance - Pretty girls should always smile
The Substance by Coralie Fargeat is a body horror comedy with a Severance-esque premise: imagine if there was a drug that could make you young and hot biweekly, with no exceptions. The movie follows Elizabeth Sparkle, a Jane Fonda esque media personality who gets fired from her exercise tv show for being too old. Elizabeth takes the titular medication, and gets her job back as her alter ego Sue - a better version of herself; younger, more beautiful, more perfect. It, of course, does not go well.
Let’s start with a simple question: do older women face discrimination based on age? Well, the economics of age discrimination are quite complicated - mainly because, well, older people may in fact be worse suited for certain jobs or tasks; additionally, applying to certain jobs after a certain age may indicate bad performance or other employability issues. To control for that, the paper “Age Discrimination in Hiring: Evidence from Age-Blind vs. Non-Age-Blind Hiring Procedures” (2020) by David Neumark uses an interesting design: he designs phoney applications where age is revealed either at the beginning of the application process or at the end, after an offer is made. When age is revealed at the start, offer rates are lower. But when the application is completed (ensuring competence) and age is then revealed, older workers also have lower chances of being hired - that is, they almost certainly face discrimination. Additionally, even when discrimination is not intentional, it can happen: using machine learning techniques, the study “Help Really Wanted? The Impact of Age Stereotypes in Job Ads on Applications from Older Workers” (2022) by Ian Burn, Daniel Firoozi, Daniel Ladd and Neumark finds that specific language choices in job postings influence the age profile of applicants - which disproportionately harms older applicants. And there is some evidence that age discrimination is worse for women: according to “Age, Women, and Hiring: An Experimental Study” (2005) by Johanna Lahey, equally qualified women have a substantially lower chance of being hired if they’re older. However, this comes with a caveat: age and gender discimination are legally protected by different statutes (the Civil Rights Act of 1964 and several age discrimination statutes respectively), which, legally, entail separate suits and separate complaints, resulting in inflated rates of reporting for women - per “Gendered Ageism and Disablism and Employment of Older Workers” (2022) by Joanne McLaughlin & Neumark. Additionally, according to Neumark et al. (2018), “Do State Laws Protecting Older Workers from Discrimination Reduce Age Discrimination in Hiring? Evidence from a Field Experiment”, age discrimination statutes do not usually have a lot of impact in terms of protecting people from unfair hiring practices based on age, but also don’t deter hiring due to fear of unfounded complaints or spurious lawsuits.
But does being hot pay off? Well, yes! For starters, attractive children are educated longer than unattractive children, which results in higher earnings down the line, even after controlling for things like social outcomes and self-confidence. Similarly, attractive people outearn unattractive people by such a degree that the gap is larger than the racial income gap, and among Black people, it’s larger than the gender wage gap. Being attractive results in higher performance ratings for professors (especially for women), higher chances of getting into a top PhD program for economists, better performance for financial analysts, higher earnings and better professional outcomes for lawyers, and even better electoral and partisan outcomes for politicians. Importantly, while billionaires are more attractive than the average person in their demographics, their attractiveness isn’t correlated to their wealth, which points to the wealth not being the cause of the attraction. And it’s true that attractive hedge fund managers tend to perform worse than “uggos”, this is because they have it so much easier, since “objectively attractive” people have an easier time being hired, so they can get hired on a thinner resume.
Nickel Boys - Only four ways out of Nickel
Nickel Boys, based on the novel of the same name by Colson Whitehead, is a first-person perspective movie (it’s really weird!) set in the 1960s about Elwood Curtis, a bright Black boy bound to college until he’s wrongly framed for a crime and sent to Nickel Academy, a brutal boarding school where the students (especially nonwhite ones) are physically and sexually abused and exploited in the way of free labor to local (White) bigwigs. Elwood befriends a cynical fellow student/immate named Turner (and it’s also kinda gay), and the two attempt to flee at the end of the movie. Elwood later lives in New York City as a small business owner, and finds out that the horrible treatment of students at Nickel is being covered by the media.
Firstly, and surprising nobody except maybe economists, systematic abuse like the one that the Nickel staff engaged in is bad for kids. In “The Consequences of Abuse, Neglect and Cyber-bullying on the Wellbeing of the Young” (2024) by David Blanchflower & Alex Bryson, the authors find significantly negative impacts on teen wellbeing (measured holistically) from physical abuse, cyberbullying, and parental and family neglect. Likewise, the paper “Does Child Abuse Cause Crime?“ (2006) by Janet Currie & Erdal Tekin finds that childhood abuse, particularly sexual, is linked to higher future crime rates among young boys, after controlling for race, income, and family background. However, the paper “The Causal Impact of Removing Children from Abusive and Neglectful Homes” (2019) by Anthony Bald, Eric Chyn, Justine S. Hastings & Margarita Machelett finds that stopping the abuse may be ineffective for boys: for kids removed after age 6 from a family background of abuse, there are no measurable benefits for boys in terms of school outcomes, but there are for girls. Lastly, and relating to the practice of “loaning out” students to local rich people, the paper “Bad Men, Good Roads, Jim Crow, and the Economics of Southern Chain Gangs” (2021) by Howard Bodenhorn finds that Black men employed in chain gangs (that is, convicts who were forced to do public labor for the government while chained to other prisoners) were not deployed with any specific intent outside of saving the taxpayer money, meaning that similar actions by the Nickel management would have been designed to save those individuals money. As for the students, it’s not likely that they would have benefitted: according to the paper “Prison-Based Education and Re-Entry into the Mainstream Labor Market” (2006) by John Tyler and Jeffrey Kling, prisoners who participated in prison work programs saw no benefits to their earnings unless they also received a GED, at which point they only saw an earnings boost for 3 years upon release (and only for nonwhite convicts). So, put together, it doesn’t seem like the extracurricular aspects of Nickel Academy were very good for students such as Elwood and Turner.
So was the Nickel Academy up to par on education? No. The school, like most other facilities in 1960s Florida, was segregated. The paper “School Equalization in the Shadow of Jim Crow: Causes and Consequences of Resource Disparity in Mississippi circa 1940” (2024) by David Card, Leah Clark, Ciprian Domnisoru & Lowell Taylor finds that, in the Mississippi Delta, per capita student funding on Black schools was of around 20 dollars per student (25 for Whites, 5 for Blacks), which had substantial impacts on latter educational and career outcomes. Similarly, posterior increases in funding raised outcomes quite singificantly, and remained having an impact on Black family earnings by the year 2000. In a similar vein, the paper “Separate and Unequal in the Labor Market: Human Capital and the Jim Crow Wage Gap” (2016) by Celeste Carruthers & Marianne Wanamaker finds that, had Black public facilities (especially schools) been equally equipped to White ones, then Black wages would have been higher, thus closing the racial earnings gap to a large extent.
NOTE: NO ISLAMOPHOBIC COMPARISON TO A CERTAIN INCIDENT INTENDED. I forgot the term for the location an earthquake starts.
In an extremely confusing turn of events, Paiva’s party (the Brazilian Worker’s party or PTB) used to be a left-labor party, then in the 1990s it supported the pro-market “neoliberal” turn of president Fernando Henrique Cardozo, then supported Lula’s more left-populist Worker’s party (PT), and then supported… far right free-marketeer Jair Bolsonaro.
Disclaimer: Chávez wasn’t actually a dictator at the time, but “putting out lists of random people who oppose you so your supporters can target them” is pretty pre-dictatorial stuff.