My life has become even busier and I doubt I will return to this blog.

Does Canada’s publicly funded, single payer health care system deliver better health outcomes and distribute health resources more equitably than the multi - payer heavily private U.S. system? We show that the efficacy of health care systems cannot be usefully evaluated by comparisons of infant mortality and life expectancy. We analyze several alternative measures of health status using JCUSH (The Joint Canada/U.S. Survey of Health) and other surveys. We find a somewhat higher incidence of chronic health conditions in the U.S. than in Canada but somewhat greater U.S. access to treatment for these conditions. Moreover, a significantly higher percentage of U.S. women and men are screened for major forms of cancer. Although health status, measured in various ways is similar in both countries, mortality/incidence ratios for various cancers tend to be higher in Canada. The need to ration resources in Canada, where care is delivered free, ultimately leads to long waits. In the U.S., costs are more often a source of unmet needs. We also find that Canada has no more abolished the tendency for health status to improve with income than have other countries. Indeed, the health - income gradient is slightly steeper in Canada than it is in the U.S.

These studies are helpful in that the alternative is not a perfectly efficient system or a perfectly equitable system, but is another imperfect system. The paper finds evidence that the US population is sicker but has better access and that the Canadian system may be more equitable but is not perfectly equitable. So, I guess this is not so unexpected after all.

User sanctions influence the legal risk for participants in illegal drug markets. A change in user sanctions may change retail drug prices, depending on how it changes the legal risk to users, how it changes the legal risk to dealers, and the slope of the supply curve. Using a novel dataset with rich transaction-level information, this paper evaluates the impact of recent changes in user sanctions for marijuana on marijuana prices. The results suggest that lower legal risks for users are associated with higher marijuana prices in the short-run, which ceteris paribus, implies higher profits for drug dealers. Additionally, the findings have important implications for thinking about the slope of the supply curve and interpreting previous research on the effect of drug laws on demand for marijuana.

If supply were elastic then price would not be much affected if the non-price costs fall.  But if the supply curve were steep, when these non-price costs fal, price must rise to equate supply with demand.

BTW, this in no way suggests that we should cut medical services to veterans. Other evidence I am acquainted with suggests that we may not do enough.

• We have moved from scarcity to abundance - and that is a bad thing.
• The world has “sped up” in the past 20 years so that people can work all the time. That the average number of leisure hours per person has actually increased over this time period is lost on Whybrow. That the world has sped up almost continuously for the past 100, 200, and 1000 years also seems to be lost on Whybrow. I conjecture that the importance of 20 years ago is that this is when Whybrow entered his professional work life and started noticing the changes.
• Commenting on the reporters work hours, “We’ve essentially taken the brakes off the business cycle in this country, and what that has done is it’s brought extraordinary material abundance. And we don’t quite know what to do with stuff.” First, speak for yourself; I know what I would do with more. Second, we economists study the determinants of growth so as to help produce ever more abundance. I always thought that this was good - good both for the pampered supermodel or pro-athlete and for the starving children in developing countries. Would he damn the latter because the former are neurotic? Third, people do buy a lot of “low brow” stuff.  But, the real growth in consumer spending has been in travel, books, music & education - all pretty “high brow” activities. Far be it from me to judge the appropriateness of what other want to do, but the increased “consumerism” does not appear to be a race to the bottom.
• Obesity, Type II diabetes, sleep deprivation, anxiety, depression all result from too much abundance. I agree here that people have substituted less health for more fun as fun has become cheaper. However, he attributes this to living “at the edge.” Unless he means the edge of the sofa, I think the evidence is that these occur because we have moved toward sedentary lifestyles because we don’t have to work as hard.
• Striving for growing abundance is a “growing physical and mental derangement.” Labor economists have estimated that over the last 30-40 years (since the data have been available), people in the US are earning and consuming more while working less. This is most pronounced among the lower income ranks. Rather than deranged, this sounds pretty rational to me.
• Toward the end of the interview, we get the real crux of the issue. We could solve this “problem” if we used more of the “rational part of ourselves.” But “all the social restraints have disappeared” due to the icon of “individualism.” The “market” had prevented people from being “greedy,” which Whybrow considers to be a “behavioral disorder.”
  1. Wow. Where to start? People are not behaving rationally. Well, individuals will, from time-to-time, behave irrationally. When they do this often, we call it a mental disorder. But, how is the indictment that all or most people are irrational all or most of the time different from defining irrationality into “doing what I don’t want them to do?”
  2. Freeing individuals from subordination from social restraints imposed by petty, and not-so-petty, tyrants is the key triumph of liberal democracies and capitalistic growth. Please don’t say we have won the war against the despots only to surrender to the intellectuals.
  3. Markets do not prevent greediness. One can argue, as Smith and Friedman have, that markets channel greediness into socially productive purposes. If anything, markets have been a check on exercising “greediness” by more violent means. Market systems have problems - externalities, information asymmetries, market power. But one of their true virtues is in channeling greediness for good.
  4. While, I cannot say if greed is a behavioral disorder or not, I am not a psychologist, I would argue that it has been necessary for the success of every species on the planet. Hoarding nuts for Winter gives squirrels a better chance of survival. Chasing competing suitors away from the nest he built, ensures the robin that his chicks will survive. Obtaining “more” makes me more successful. How is this different from greed? How and why should it be overcome?

If Whybrow’s thesis were correct, I should repent of my evil ways and try to convert my brethren in economics departments. Instead, I will continue to worship the “devil” of abundance versus scarcity while singing “Greed is Good.”

This has also been the claim about hiring young women.  It is still the case that many women will choose to interrupt their careers when they become mother.  They do so much more often than young men interrupting their careers when they become fathers.  To the extent that career interruptions are expensive to employers, employers will infer that women are “high cost” employees to be avoided.  How much does this inference explain bias against women and how much bias is due to preference for men?

Perhaps the reservist evidence can allow us to get a handle on the inferential effect.  If so, we might be able to attribute any residual bias to a preference difference.

1. Farm prices are high and, consequently, farm incomes are currently through the roof.  The “income support” justification seems to be especially weak.
2. There is increasing pressure from international trade associations to eliminate subsidies. Other industries that want foreign trade barriers to fall are finding resistance because our subsidies are seen as trade barriers.  Action in one sector will require a quid pro quo in agriculture.
3. Relatedly, there is increasing awareness that our policies are likely impoverishing poor farmers in developing countries.  Voters typically have a soft spot for helping starving children in faraway places.

Realistically, agriculture is also the textbook example from “public choice” theory of a focused interest group of producers winning out over more diffuse food consumers, we hold little hope that it will ever change.  As long as plains states have two senators and Iowa holds the first caucus, I expect political support for farm welfare.

Many violent relationships are characterized by a high degree of cyclicality: women who are the victims of domestic violence often leave and return multiple times. To explain this we develop a model of time inconsistent preferences in the context of domestic violence. This time inconsistency generates a demand for commitment. We present supporting evidence that women in violent relationships display time inconsistent preferences by examining their demand for commitment devices. We find that no-drop policies — which compel the prosecutor to continue with prosecution even if the victim expresses a desire to drop the charges — result in an increase in reporting. No-drop policies also result in a decrease in the number of men murdered by intimates suggesting that some women in violent relationships move away from an extreme type of commitment device when a less costly one is offered.

Many women fear they will not follow through if they file a complaint and so do not file.  Committing women to go through with it induces them to file. And, by-the-way, seems to lead them to use less lethal means of solving their problems.

Hat tip to MarginalRevolution.

In the past few years, YouTube and other sites for sharing video files over the Internet have vaulted from obscurity to places of centrality in the media landscape. The files available at YouTube include a mix of user-generated video and clips from network television shows. Networks fear that availability of their clips on YouTube will depress television viewing. But unauthorized clips are also free advertising for television shows. As YouTube has grown quickly, major networks have responded by making their content available at their own sites. This paper examines the effects of authorized and unauthorized web distribution on television viewing between 2005 and 2007 using a survey of Penn students on their tendencies to watch television series on television as well as on the web. The results provide a glimpse of the way young, Internet-connected people use YouTube and related sites. While I find some evidence of substitution of web viewing for conventional television viewing, time spent viewing programming on the web — 4 hours per week — far exceeds the reduction in weekly traditional television viewing of about 25 minutes. Overall time spent on network-controlled viewing (television plus network websites) increased by 1.5 hours per week.

This reminds me of early studies that found that TV did not fully crowd out radio.  Initially, TV news did not have much of an impact on newspapers, but I conjecture it has had a larger long run effect.

Social Security provides spousal benefits in retirement to secondary workers in married couples based on the primary worker’s earnings record. In addition, Social Security pays spousal benefits to divorced secondary workers whose marriages lasted at least ten years. However, if a marriage failed in less than ten years, no spousal benefits are paid. The spousal benefit is particularly valuable to secondary workers in couples where there is a large disparity in earnings between the primary worker and the secondary worker. We examine whether these couples, who have more to gain from extending their marriage to ten years, are more likely to delay divorce to the tenth year relative to a control group. We find that vulnerable couples are slightly more likely to delay divorce from year nine to year ten; however, the effect is statistically insignificant and small in magnitude. While the “cliff”-vesting of retirement benefits for divorced spouses raises equity concerns, it does not appear to distort incentives for divorce.

Even though the economics says there could be an effect, it all depends on the magnitudes.  In this case, they are small.