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Assorted links
1. WEIRD subjects and their importance for social science.
3. Andrew Gelman will have a second blog. I don't yet understand the forthcoming principle of individuation across the two blogs.
4. London Review of Books, full issue on-line.
5. Nouriel Roubini on the new carry trade.
6. From Chris F. Masse, nextbigfuture.com, a new science blog. Here's their update on space elevators.
7. Will Doug Holtz-Eakin lose his health insurance?
8. Is Earth a habitable planet?
9. Germany's new conservative cabinet. Not like ours would be.
10. Strictly personal interview with Esther Duflo.
11. Why American health care costs so much.
That's a lot but they're all good links.
Posted by Tyler Cowen on November 2, 2009 at 01:32 PM in Web/Tech | Permalink
Comments
"Not like ours would be."
Right, because being a baron would present a legal problem. The others are more or less plausible.
Posted by: John Thacker at Nov 2, 2009 1:38:47 PM
Re: #3 - I have three blogs. It's not about my individualism, but my readers'*. They cover very different topics, so I blog them separately so my readers*
*Assuming I have any.
Posted by: Brock at Nov 2, 2009 2:21:05 PM
Vaguely re #11 - There seem to be two issues about health care reform that people talk about (not counting teabaggers, insurance lobbyists and such).
Issue One is health care costs and their growth. And this is important issue that will eventually need to be resolved.
Issue Two is actually being able to get health care, which current system doesn't guarantee between rescissions, pre-existing conditions, and lack of adequate subsidies, and mandates.
So people like you and Robin talk mostly only about costs, and people like most health care reform supporters talk mostly about universal coverage.
The thing is - cost control without universal coverage is not terribly useful. People will keep dying due to lack of health care, people will keep being abused by insurance companies, will keep wrong jobs to get healthcare, and so on. Serious cost controls in current environment are very likely to reduce access even more.
Going for universal coverage first, and hopefully in a way that doesn't make dealing with costs issue too much harder later, seems like getting priorities much more straight. Problem of people dying gets converted to much easier problem of budget deficits.
Due to budget constraints, there will be constant pressure to reduce costs, no matter what lobbyists do. The government will find ways to cut costs, because it simply won't be able to run huge deficits, and dealing with lobbyists is much easier than dealing with angry taxpayers. It worked quite well in all other OECD countries.
Posted by: Tomasz Wegrzanowski at Nov 2, 2009 2:33:40 PM
Why does Ezra Klein fail to mention the obvious consequences of price controls? I mean he does pretend to be an economist, right?
Posted by: Noah Yetter at Nov 2, 2009 3:18:23 PM
Re 11 there is a third issue: quality of treatment. The thing is-- universal coverage is not terribly useful if current treatments aren't good enough to fix what ails you. People will keep dying due to lack of new discoveries, people will keep getting abused by the side effects of current drugs, will keep wrong doctors because of a lack of information on treatment success rates, and so on. Serious cost controls are very likely to reduce research even more.
I favor cost control and universal coverage too but I don't know how to achieve any 2 out of the 3 let alone all 3. But, I would bet that the lifespan of the currently uninsured will depend more on what new treatments have been developed 20 years from now than on what treatments they get subsidized access to today.
Posted by: DK at Nov 2, 2009 3:19:25 PM
#8 is quite interesting. Thanks.
Posted by: Bernard Yomtov at Nov 2, 2009 3:28:15 PM
As usual, the Klein discussion says Obama isn't dealing with the cost issue, because he is dictating that everyone be in the game whether individual or corporation by government mandates which are taxes, and so that only increases the costs, so what we need is the free market where profit drives things and costs are controlled by excluding the expensive people from the game. Then anyone who provide health care to the people thrown out of the game is a tax and spend liberal who won't let the free market work as it should to keep costs down.
The NY Times story http://prescriptions.blogs.nytimes.com/2009/10/30/lacking-insurance-hospitalized-children-more-likely-to-die/?ref=research reports children without insurance coverage are 60% more likely to die when they arrive at a hospital, and they die in half the time of the insured - half a day instead of a full day of the public or privately insured - and for about a quarter the cost. (If they survive the first day, the outcomes and costs of the insured and uninsured are the same). Malthus would approve, I think, seeing that as the way god intended - those deserving survive as they are the fittest, and those who lacking means are clearly undeserving are the unfit more likely to die.
Of course, liberals have messed with the natural order by providing Medicaid to the unfit who, deserving less are poor, and thus should be among the uninsured who are 60% more likely to naturally selected out in their first day in the hospital.
I find the chart on visits interesting as I have $5000 deducible insurance which requires I use the insurer's network to get bills credited toward the $5000 if I end up needing the insurance, and I'm billed twice what the chart shows, which after it pays through the insurer is reduced so that I pay the provider the figure in the chart. So, the price for those uninsured are even higher than in the charts, unless one is bankrupt, in which case you get the public plan - the public fights to not pay for your bills that you can't possibly pay.
The fiction is the prospect of everyone not being in the the same public health pool, with the only issue being how unequal can the costs be allocated and how much profit is extracted in the process of cost shifting and how much employment is increased by introducing inefficiency. For those providing care, increasing employment and profit are virtues as long as the public can be forced to pay for them, and divide and conquer has worked really well for the past three decades in doubling the cost of health care beyond what it should be.
Posted by: mulp at Nov 2, 2009 3:37:12 PM
Re Noah: Pretend seems to sum it up accurately. Is there perhaps a more naive blogger out there than Ezra Klein?
Posted by: BL at Nov 2, 2009 3:37:39 PM
5. can anyone explain what roubini means when he says traders are "borrowing at negative 20% rates"? if i can borrow at negative 20% rates, why oh why would i need to invest it in risky assets? this story doesnt pass the bs test.
Posted by: rob at Nov 2, 2009 4:02:35 PM
@rob: Because it ain't going to last.
Posted by: JSK at Nov 2, 2009 4:35:04 PM
can anyone explain what roubini means when he says traders are "borrowing at negative 20% rates"
I think he means that they are making 20% by shorting the declining dollar. This is not risk-free by any means. The problem Roubini is concerned about, as I understand it, is that when the dollar decline stops, and it will, traders will be forced to sell off assets to cover dollar short positions. He fears that, for reasons he cites, we are building yet another asset bubble.
Posted by: Bernard Yomtov at Nov 2, 2009 4:41:29 PM
#8 is a bit exxagerated. Ok, sure, over the complete theoretical lifespan of the earth, it is only habitable for 7% of the time or whatever figure he came up with. But the surface area argument is just silly. Postulate that aliens have travelled uncounted light years to arrive in our solar system. They get close enough to earth to land their "meat probes" on the surface safely. But! Apparently they are also blind and stupid since they will choose a surface location randomly (!) so survival rate drops to 1%, since a lot of their probes will land on the mountains, deserts, open water, or the Anarctic. Give me a break.
Using a similar chain of "logic" you could have argued that the New World wasn't habitable and so explorers should have never left Europe. Take the east coast of the two American continents - something like 75% of it can't be landed at due to cliffs, rocks, lack of deep water harbors, and inclement weather! Yet somehow those unlikely Europeans managed to settle the Americas.
Posted by: Bob Montgomery at Nov 2, 2009 4:55:04 PM
If Tyler was feeling snarky, he would have titled #11:
"Why European health care is so good."
Posted by: Bob Montgomery at Nov 2, 2009 4:58:37 PM
#2. Didn't read the paper, but from the blog post this is just the winner's curse
Posted by: Nick at Nov 2, 2009 5:07:58 PM
How much innovation in medicine occurs outside the U.S.? None?
Posted by: Anne T. Positivist at Nov 2, 2009 5:19:20 PM
Re: #1 – the alleged bad habit of generalizing to the world from behavioral studies of undergraduates in Western, Educated, Industrialized, Rich and Democratic (WEIRD) societies. At first glance it seems a clever even counter-intuitive insight. The article is rather long and I haven’t time to read it right now. A quick scan reveals that they specifically exclude the many studies that seek to identify the variability of values across populations as found in the conventional cultural programming literature. But as a first reaction I’d say the interesting question here is really why WEIRD societies are different. My pet theory is simple and quite old-fashioned, namely that people’s universalistic behavior across mass society responds most categorically to impersonal formal institutional incentives. So I word-searched the article for ‘institutions’ and ‘incentives’. Lo, the answer seems to be as obvious as it has long been. For example:
“In some cases, at least in their most efficient forms, neither markets nor large populations were feasible before such norms and institutions emerged. That is, it may be that what behavioral economists have been measuring among undergraduates in such games is a specific set of social norms, culturally evolved for dealing with money and strangers, that have emerged since the origins of agriculture and the rise of complex societies.” Then: “behaviors measured in the experiments... are strongly correlated with the strength of formal institutions, norms of civic cooperation, and GDP per capita.”
How silly it was of any researcher ever to assume that behaviors of western undergraduates could be representative of the world’s population. Having discovered this silliness, how can you now persuade researchers to interrogate their misplaced and lazy focus on WEIRD society cohorts? Lo, again it is obvious: “The problem, then, is not exclusively a scientific or epistemological disagreement, but one of institutionalized incentives.”
In other words, you stop the silliness by changing the formal (micro-)institutional incentives issuing from the universities and grant-giving bodies. Pending a more thorough read of the article, I’d stick my neck out and speculate that the formal institutional incentives experienced by the authors of this article might privilege false novelty over true substance.
Posted by: Michael G. Heller at Nov 2, 2009 5:29:10 PM
5. Nouriel Roubini on the new carry trade.
Can also be found here
http://www.rgemonitor.com/roubini-monitor/257912/mother_of_all_carry_trades_faces_an_inevitable_bust
Posted by: anon at Nov 2, 2009 6:36:44 PM
I am always greatly amused by people who wonder "Why is X so much cheaper elsewhere?" and the answer is because the government has price controls. Maybe we should have those too!!
Sure, they never mention that it takes 9 months to get an MRI for your spinal cord injury. Because hey, it's half-price! Apparently, when you limit the price of something, the supply shrinks. Pretty advanced, I know.
As for the fact that drugs are cheaper overseas because the USA is subsidizing their purchase there -- we'll leave that for another time. Instead, we'll just let politicians talk about how smart it would be to export them and re-import them. High comedy.
Posted by: Jim at Nov 2, 2009 6:59:16 PM
RE Roubini:
1) A carry trade normally means the money you make on the interest rate spread between currencies, right? So why does Roubini include capital gains into the mix and refer to it as an annualized interest rate? This is bizarre.
2) Isn't the decline in the dollar DUE TO re-investment in international assets, not the CAUSE of it?
3) Roubini's reason why the dollar must eventually reverse and cause panic covering: "because the dollar cannot go to zero". Let's take this mesmerizing reasoning at its undeserved face value a moment: he is still wrong. The dollar can decline at an annual rate of 20% from here to eternity. Does this man have a real degree?
Posted by: rob at Nov 2, 2009 7:06:43 PM
How much innovation in medicine occurs outside the U.S.?
Quite a bit, but that's irrelevant. The key question is: how much innovation (in the US and elsewhere) occurs because of the large profits available in the US market?
Posted by: Brian 2 at Nov 2, 2009 7:36:15 PM
"I don't yet understand the forthcoming principle of individuation across the two blogs."
Alternatively: "I'm not sure how they will differ."
Posted by: js at Nov 2, 2009 7:46:36 PM
"I don't yet understand the forthcoming principle of individuation across the two blogs."
Alternatively: "I'm not sure how they will differ.
Your alternative is insufficiently abstruse.
Posted by: Bernard Yomtov at Nov 2, 2009 9:05:51 PM
@ Michael G. Heller:
First, they do discuss these cross-cultural studies. Spatial tasks, ultimatum games, etc. are all there.
Second, although I completely agree that behaviour responds significantly to impersonal formal institutional incentives, there is nonetheless the question of how exactly such institutions and incentives influence behaviour, not to mention the question of where they come from in the first place and how they change.
In any event, I'm not sure it's really counterintuitive. People in different places are different in many ways. But drawing attention to this fact is a useful thing to do.
Posted by: Pareto at Nov 2, 2009 9:15:55 PM
"I don't yet understand the forthcoming principle of individuation across the two blogs."
Alternatively: "I'm not sure how they will differ."
TC: Those two sentences are so, so different. One is about results, the other is about the process in Gelman's mind. The latter is more interesting than the former.
Posted by: Tyler Cowen at Nov 2, 2009 9:40:10 PM
#11
Would there be healthcare cost deflation if we did not enact healthcare reform? Would the market collapse. An interesting question, but, since we are doing reform, why not do some costless healthcare reform to introduce information into the market.
Here are some ideas for inclusion in the healthcare bill:
1. All non-profit hospitals have to disclose salaries and benefits for the top four executives. I know what this would disclose, and the public reaction would be interesting. Non-profit my a..
2. All television drug advertising hasto disclose the price of the drug in the advertising. You might think twice about requesting that purple pill if you knew the price. I think the average consumer would be shocked.
Posted by: Bill at Nov 2, 2009 11:10:05 PM
