This chart was getting bandied around on a forum and it got me thinking about US healthcare spending. Luckily it mentioned its data source, leading me to http://www.oecdilibrary.org/content/book/health_glance-2009-en and a statistics package from BPI consulting. It's going to be time to think about relationships and throw some math at some data to see if I can reject a null hypothesis or two.
Question: Why is the US healthcare system so expensive (relative basically everybody else)?*
Possible contributers:
-Lack of monopsony power by purchasers.
-Insurance companies do have some monopsony power in re doctors and hospitals.
-Drug price ceilings?
-Inefficient competition in the market.
-AMA licensing and accreditation limits participants.
-Lack of the ability to advertise. Compare Lasik to other outpatient procedures
-Limited numbers of hospitals, does this compare to other limited suppliers?
-How do these factors make the American market different than other healthcare markets?
-3rd party payments
-Moral hazard and adverse selection
-Creates a subsidy or price floor. (Which is a better model?)
-Technology
-Do we use more medical technology than other countries?
-General American trends
-Do we pay doctors, nurses and medical people more than others?
-Do we pay doctors etc more relative similar Americans?
-Income effects
-Do we consume more healthcare because it's a superior good and we can afford it?
-Can this be related to the income differences between Americans and Europeans?
-Test: What kind of things do we spend out money on? What percentage goes to "extra" healthcare?
-All the stuff I haven't thought of yet
OK, so the data that I found don't look like they address most of the things that cause high US health costs. This will take some thinking.
*Let's leave results out for this, those may be for other reasons than economics and I don't know enough medicine to tell the difference between a good theory and data mining.**
**I probably don't know enough about the healthcare system to tell good results from data mining either, but hey, there might be some chance on that one!
Tuesday, January 19, 2010
Robin Hoodlums
My new title for redistributionists. Either it's kinda catchy or it's 5:00 am and I'm sleep deprived. Google only shows one non-flash-game reference in the top few and that's from 2005 (talking about Bush, I savor the irony.)
I shall persevere to spread this across the Web.
I shall persevere to spread this across the Web.
Friday, January 15, 2010
Dynamics of the fur trade
I just finished watching a PBS program on the early fur trade in Minnesota (is it just me or is MN's PBS obsessed with the iron range?)
A few interesting facts stand out: While the French dominated the area, trade was conducted at posts but the traders mostly interacted with tribal leaders. The leaders would bring in furs and pick out what goods they wanted in trade, then they would go and distribute those goods to their people. Also, early in the period the French seem to have stayed near Lake Superior and the Ojibway tribe specialized as middlemen, bringing furs from other, more western tribes and sending goods back. That let the Ojibway keep a monopoly on guns, apparently.
As the french moved further west they began trading directly with the indians doing the hunting and trading guns with them. This led to the Ojibway making war on the Cree and others in the area in order to claim the more fertile hunting grounds since their monopoly on brokering trade had been broken.
After the French and Indian War two English companies moved in. The Hudson Bay company had been active since the late 17th century but they were primarily a ship based group who would make landfall and let the Indians come to them. The Northwest Company moved into the old French trading posts and went to the Indians' villages to trade. This let the Northwest Company gain a huge advantage over the Hudson Bay company, at one point handling something like 78% of all furs.
Both English companies behaved differently than the French in that they traded directly with individuals, cutting the chiefs out of the goods distribution business. Unfortunately there was no mention of how this impacted tribal culture.
Traders established a point system where certain types of pelts were assigned a point value as well as trade goods. It's not entirely clear, but it sounds like the traders sold on credit, allowing the Indian to pick out what supplies he wanted for the winter then coming back with pelts in the spring to pay for it. If this was the case, the fact that the white traders would shoulder the economic risk of something bad happening to an Indian over the winter by granting him credit kicks some of my preconceptions in the pants. I would have thought every transaction between whites and Indians would have been cash over the barrel head.
Finally, the Hudson Bay company wised up and moved their operations to where the Indians were and established trading posts near the Northwest Companies posts, starting a trade war which included shooting as well as (probable) price competition. Unfortunately, the program didn't delve into that aspect before it ended.
A few interesting facts stand out: While the French dominated the area, trade was conducted at posts but the traders mostly interacted with tribal leaders. The leaders would bring in furs and pick out what goods they wanted in trade, then they would go and distribute those goods to their people. Also, early in the period the French seem to have stayed near Lake Superior and the Ojibway tribe specialized as middlemen, bringing furs from other, more western tribes and sending goods back. That let the Ojibway keep a monopoly on guns, apparently.
As the french moved further west they began trading directly with the indians doing the hunting and trading guns with them. This led to the Ojibway making war on the Cree and others in the area in order to claim the more fertile hunting grounds since their monopoly on brokering trade had been broken.
After the French and Indian War two English companies moved in. The Hudson Bay company had been active since the late 17th century but they were primarily a ship based group who would make landfall and let the Indians come to them. The Northwest Company moved into the old French trading posts and went to the Indians' villages to trade. This let the Northwest Company gain a huge advantage over the Hudson Bay company, at one point handling something like 78% of all furs.
Both English companies behaved differently than the French in that they traded directly with individuals, cutting the chiefs out of the goods distribution business. Unfortunately there was no mention of how this impacted tribal culture.
Traders established a point system where certain types of pelts were assigned a point value as well as trade goods. It's not entirely clear, but it sounds like the traders sold on credit, allowing the Indian to pick out what supplies he wanted for the winter then coming back with pelts in the spring to pay for it. If this was the case, the fact that the white traders would shoulder the economic risk of something bad happening to an Indian over the winter by granting him credit kicks some of my preconceptions in the pants. I would have thought every transaction between whites and Indians would have been cash over the barrel head.
Finally, the Hudson Bay company wised up and moved their operations to where the Indians were and established trading posts near the Northwest Companies posts, starting a trade war which included shooting as well as (probable) price competition. Unfortunately, the program didn't delve into that aspect before it ended.
Thursday, January 14, 2010
Thinking at the margins: Farming
I'm watching the documentary "King Corn" on Netflix, it's quite interesting and the first half hour at least gives a really good description of modern farming. (datum: 1 acre = 200 bushels = 10,000 pounds of corn at the top end.)
As they were talking to to the farm supply store about fertilizer I got to wondering about what's marginal in farmers' decision making. You have multiple options for what to plant, how to fertilize it, what herbicides and pesticides to use, etc. I wonder how many of these factors are flexible and how many are determined by exogenous forces? That is, are your fertilizer and herbicide usages strictly determined by the type of soil and plant, or do you have a range of options? Are there a large number of marginal decisions to make, or is the number of acres to plant the primary marginal decision?
Earl Butz is apparently a large part of the reason why our farm subsidy system changed from limiting production to keep prices up to subsidizing any level of production and encouraging farmers to grow as much as possible. The documentary does a great job of showing the economics of corn farming and where all that corn goes without getting political in any direction (despite the producers' obviously evolving personal opinions.) I highly recommend it.
As they were talking to to the farm supply store about fertilizer I got to wondering about what's marginal in farmers' decision making. You have multiple options for what to plant, how to fertilize it, what herbicides and pesticides to use, etc. I wonder how many of these factors are flexible and how many are determined by exogenous forces? That is, are your fertilizer and herbicide usages strictly determined by the type of soil and plant, or do you have a range of options? Are there a large number of marginal decisions to make, or is the number of acres to plant the primary marginal decision?
Earl Butz is apparently a large part of the reason why our farm subsidy system changed from limiting production to keep prices up to subsidizing any level of production and encouraging farmers to grow as much as possible. The documentary does a great job of showing the economics of corn farming and where all that corn goes without getting political in any direction (despite the producers' obviously evolving personal opinions.) I highly recommend it.
Wednesday, January 13, 2010
In the news
Here's the video from Northfield's reporter at Kyudo last week.
Hmm, he didn't get a release from everyone while videoing, nor did he give the names of everyone shown. Somehow I don't think my mother will much care.
Hmm, he didn't get a release from everyone while videoing, nor did he give the names of everyone shown. Somehow I don't think my mother will much care.
Thursday, January 7, 2010
Back to shooting
There was a reporter from Northfield, MN's newspaper at the Wednesday Kyudo practice, so I managed to convince myself to get up early enough and let my manager know I would be late for work and actually get to practice.
It was good to pull a bow again even though my posture was horrid, I failed miserably at sitting in kiza and was sloppy at basically everything. Maybe getting to practice more often would make a good (belated) New Year's resolution.
Kyudo is a great sport... if you have the temperament. This person in the video takes over 3 minutes to shoot two arrows in the quickest method available: Normally you shoot sequentially in groups of up to five instead of solo, often you will sit (Japanese style, on your knees) between shots, and depending on your natural rhythm, your pace of actually drawing and shooting might even be slower than his. In fact, these two videos show the type of ceremony usually performed at the start of a seminar or tournament. It's a martial art, but it's the slowest martial art you'll ever see. It makes grandma's tai chi look positively frenetic!
One of the aspects that I find most interesting is that everybody shoots the same way. From the ceremonial style in the second video to casual practice in the first, between setting their feet lowering the bow after release, every action is the same. There are some well defined variations, but they're limited to two methods of knocking your arrow, two methods of setting your feet, two methods of raising your bow and starting your draw, and some variations of how you hold your hand depending on the type of glove you use. Those aren't even mix and match options, if you knock your arrow in one way, you will set your feet and raise your bow in a specific method.
All the different ceremonies and tests add things around the shooting, but the actual shooting is always the same. Everything is very formulaic, you spend years practicing kyudo working on nothing but perfecting those same eight steps. It's a wonderful sport if you're the type of personality that enjoys constantly refining and improving how you do a specific set of tasks.
But never forget, kyudo is a shooting sport so at the end of all that focus and concentration and stillness, you end up shooting stuff. It's very much like Zen meditation with instant gratification. (Or frustration, there's always plenty of frustration when accuracy's involved. ;P )
It was good to pull a bow again even though my posture was horrid, I failed miserably at sitting in kiza and was sloppy at basically everything. Maybe getting to practice more often would make a good (belated) New Year's resolution.
Kyudo is a great sport... if you have the temperament. This person in the video takes over 3 minutes to shoot two arrows in the quickest method available: Normally you shoot sequentially in groups of up to five instead of solo, often you will sit (Japanese style, on your knees) between shots, and depending on your natural rhythm, your pace of actually drawing and shooting might even be slower than his. In fact, these two videos show the type of ceremony usually performed at the start of a seminar or tournament. It's a martial art, but it's the slowest martial art you'll ever see. It makes grandma's tai chi look positively frenetic!
One of the aspects that I find most interesting is that everybody shoots the same way. From the ceremonial style in the second video to casual practice in the first, between setting their feet lowering the bow after release, every action is the same. There are some well defined variations, but they're limited to two methods of knocking your arrow, two methods of setting your feet, two methods of raising your bow and starting your draw, and some variations of how you hold your hand depending on the type of glove you use. Those aren't even mix and match options, if you knock your arrow in one way, you will set your feet and raise your bow in a specific method.
All the different ceremonies and tests add things around the shooting, but the actual shooting is always the same. Everything is very formulaic, you spend years practicing kyudo working on nothing but perfecting those same eight steps. It's a wonderful sport if you're the type of personality that enjoys constantly refining and improving how you do a specific set of tasks.
But never forget, kyudo is a shooting sport so at the end of all that focus and concentration and stillness, you end up shooting stuff. It's very much like Zen meditation with instant gratification. (Or frustration, there's always plenty of frustration when accuracy's involved. ;P )
Wednesday, January 6, 2010
Sex disparities at the margin?
There was an interesting question on the xkcd forums asking why there's such a preponderance of men over women in the comedy industry. Standup comedy seemed to be the focus as the most male dominated part of the field, and it got me thinking:
Are preference differences exaggerated at the margin? If 80% of office workers are men, that's one thing since office work is a very common career. But if 80% of a very small career field like stand up comedians are men, does that simple statistic really tell you much about whether or not sexism or acculturation is the cause of the disparity?
I think small absolute differences in preferences might lead to a large disparity in outcomes at the margin, where there are both few jobs to go around and a small proportion of the population searching for them.
Are preference differences exaggerated at the margin? If 80% of office workers are men, that's one thing since office work is a very common career. But if 80% of a very small career field like stand up comedians are men, does that simple statistic really tell you much about whether or not sexism or acculturation is the cause of the disparity?
I think small absolute differences in preferences might lead to a large disparity in outcomes at the margin, where there are both few jobs to go around and a small proportion of the population searching for them.
Sunday, January 3, 2010
Profit maximization in non-profits
Some chain of links led me to this blog article about how inefficiently aid money is allocated.
It reminded me of a question I was wondering about earlier in the week: How do non-profits allocate their resources if they're not trying to maximize profits. What are they trying to maximize? Productivity in the form of goods or services provided, or maybe revenue in terms of donations received. What about something else like maximizing notoriety with keeping their status as a non-profit as the constraint? Probably not payment to their employees since we don't hear about Wallstreet style pay scandals from places like Acorn, and the non-profit sector is notorious for low pay. What if they don't maximize, i.e. they're not at the production possibility frontier?
I'd imagine there is some of everything going on, so another question is whether they're randomly distributed across all forms of non-profit or do certain industries congregate around certain forms of maximization?
It reminded me of a question I was wondering about earlier in the week: How do non-profits allocate their resources if they're not trying to maximize profits. What are they trying to maximize? Productivity in the form of goods or services provided, or maybe revenue in terms of donations received. What about something else like maximizing notoriety with keeping their status as a non-profit as the constraint? Probably not payment to their employees since we don't hear about Wallstreet style pay scandals from places like Acorn, and the non-profit sector is notorious for low pay. What if they don't maximize, i.e. they're not at the production possibility frontier?
I'd imagine there is some of everything going on, so another question is whether they're randomly distributed across all forms of non-profit or do certain industries congregate around certain forms of maximization?
Since the Steelers are out of the running
I got to thinking about how the NFL works, and whether or not it relates to the rest of us.
Football is the consummate team sport, even the best running back or quarterback in history can't force a team with a bunch of pantywaists for a line to win games. But, the league tries to create equality within teams by giving draft picks out in inverse order of performance and capping salaries. The draft issue is interesting, presumably the majority of the best college athletes go to the worst teams (trading for draft picks might offer a natural experiment,) and for every first round draft pick who's a standout you also seem to hear about a late round pick doing just as well. Is that because teams aren't necessarily good at picking good performers, or is it because the best athletes don't get a good chance to shine while stuck with bad teams? Or is this all a misconception?
Football is the consummate team sport, even the best running back or quarterback in history can't force a team with a bunch of pantywaists for a line to win games. But, the league tries to create equality within teams by giving draft picks out in inverse order of performance and capping salaries. The draft issue is interesting, presumably the majority of the best college athletes go to the worst teams (trading for draft picks might offer a natural experiment,) and for every first round draft pick who's a standout you also seem to hear about a late round pick doing just as well. Is that because teams aren't necessarily good at picking good performers, or is it because the best athletes don't get a good chance to shine while stuck with bad teams? Or is this all a misconception?
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