by Tyler Cowen
on February 12, 2013 at 1:04 pm
1. How the Snickers bar has changed over time.
2. Correlation does not prove causation, Danish marriage edition.
3. Will spending caps work?, and more here from Matt.
4. Very good older piece from Fuchsia Dunlop, “Perplexing encounter with a gastro-nihilist.”
5. Bill Gates answers questions on Reddit.
6. Say law follies, by Scott Sumner.
7. Are we bending the health care cost curve?, by Annie Lowrey, and see this chart on hospital construction.
8. Brad DeLong has on-the-mark comments on the Ezra profile.
3. This gets the fundamental problem with increases in healthcare spending. The only real fix is opening our borders to both skilled and unskilled workers. Health inflation can be quite easily tackled if the medical community allowed Medicaire money to be used at Mexican clinics, giving some percent of costs saved as reimbursement. This would force more competitive prices in the border states, which would hopefully percolate up north.
We should try to substantially increase labor we get from Asia and Mexico. Both of these are closing windows, and with our current hostile policy, net gain from Mexico is all but zero.
People talk about how America has a stronger demographic than Europe and Japan. While this is certainly true, Caucasian Americans have a lower birthrate for the first time than the British or French. The only thing helping us is immigration. All this Balanced Budget nonsense won’t even matter if we keep our borders closed.
“While this is certainly true, Caucasian Americans have a lower birthrate for the first time than the British or French. The only thing helping us is immigration.”
What does it matter that Caucasian females have a slightly lower birthrate than black or Latina females? What matters is the overall rate. And the US is doing fine.
US Fertility rates by race:
US Fertility rate overall by time:
And anyway you are wrong about Britain. And France has the same fertility rate as the US for the last 2 years and was noticeably lower the previous 10 years. Overall the US rate has been fairly stable.
But the purpose of Medicare is not to provide free health care to all seniors. That is part of it but another part is to ensure that US doctors are the highest paid in the world. Importing more doctors, training more doctors, or sending sick people abroad for care would undermine that purpose.
The current US medical professionals prefer the current system where we produce and allow to immigrate fewer doctors than any other western or OECD country in order to drive wages to monopoly levels. US doctors compete harder for med school slots, spend more of their educational time in hazing rituals posing as training, and get paid higher than any of their world peers.
Mexican doctors, on the other hand, earn among the lowest incomes in the OECD. They barely exceed those of British doctors and may have passed some others like Australians’ but are still scraping the bottom. Also Mexico is training many more doctors per capita than the USA is so the supply feels threatening to privileged US doctors. The US doctors’ lobby is never going to tolerate competing with Mexican doctors and it will be difficult to force it on them.
But I guess if anyone can do it, it will be the AARP.
You’re right that I’m wrong about Britain – should check my facts.
And it matters because the overall rate goes down when Latinas and blacks are a higher percentage of the population, and we want more Latinos, and we happen to have a lovely source sitting right under us when instead we’re acting like clowns about “border security”.
I’m not sure why you are convinced:
a) We need a larger population. What’s the perfect size and why?
b) If we do need a larger population, Why “we want more Latinos” vs any other mix.
c) If we did decide on Latinos over any group what makes the “lovely source sitting right under us” better than any other hispanic country? Is there some unique quality that makes Mexican’s superior to other Latinos?
(trying to answer your (b) and (c) )
Its a little early to celebrate reductions in the rate of spending on heath care, I think. Spending is still increasing, if at a lower rate. This could be no more than a ceiling effect, we’ve handed out every type of care there is, there ain’t no more goodies to hand out. It could be stagnation in Add in overall economic slowdown… and so far I’m unimpressed. That DeLong hospital spending graph is doubly so, it looks like the overall economy, and add in hospital spending slowdowns as a result of regulator uncertainty as a result of Obamacare, and there you go.
6. As far as I can tell from a quick scan, nowhere in the post does SS actually quote Say. It is worth rereading Say and also JS Mill’s further elaboration to understand the phoniness of Krugman’s arguments. Both can be found in the Critics of Keynesian Economics. I suppose that modern economists spend so much time with mathematics and sterile models that they cannot spare the time to read the classic texts of economics.
Right. And the takeaway I got from reading Scott Sumner is that he is pushing his pet theory, which sounds like some Great Depression cure-all like the “Townsend Plan”: (Scott Sumner: “The problem is that inflation is the wrong target—they should stabilize NGDP growth.”). As if stabilizing NGDP–if you could even accurately measure it–would magically sure all problems. But I think Sumner is right that the Keynesians themselves can be taken to task for violating Say’s Law, in particular the part about how AD responds instantly and magically to stimulus.
We can measure NGDP more accurately than real GDP, since real GDP starts with NGDP and then applies a deflator. With NGDP you just add up a bunch of dollars.
But what do people care about? I can’t eat dollars…I eat food. I can measure a lot of things well that don’t matter. So? You have to assume relationships back to the real side for NGDP to matter…not sure those are cleaner than assumptions to construct real GDP.
Re. #1, the writer complains that shape change for Snickers bars makes them taste different than before. That is no surprise to anyone who likes Reeses Peanut Butter Cups. They have all kinds of sizes and each has different shapes and proportions. The bite size Christmas Reeses, for example, taste different than the regular ones, because the ratio of chocolate to peanut but varies with the geometry.
Yeah, the holiday editions (hearts, eggs, etc.) tend to be cakey.
The eggs have the best ratio.
Since the dark chocolate ones now exist, all the others are inedible by comparison.
And I can find them only in the classic geometry (and ratio) which is a fine ratio. If I were to subject myself to the vile milk chocolate variety I’d prefer the eggs which have less chocolate but those are, as Ted observes, cakey.
2. Is this any different then the wives of wealthy men getting boob jobs and other cosmetic procedures?
If I were a kept man, I would assume it’s a full-time job.
Ted, I don’t think that’s the gigolo angle (to parallel the trophy wife one) is what the researchers are uncovering… 🙂
I’ve seen some other research (in the Telegraph, UK) saying that men earning less than their wives were more likely to cheat. And so too were men earning significantly more.
According to that article, the ‘sweet spot’ was when the wife was earning 80% of her husband… Enough to give the woman some power in the relationship but not so much it’d crush the man’s fragile ego…
8. Two points.
Why does Tyler Cowen often refer to Ezra Klein as simply “Ezra?”
Second, I continue to have a conspiracy theory that Kelin is a front. Like, I said, conspiracy theory, but still…
Just because you think a theory is disreputable doesn’t make it a conspiracy theory. If Tyler has a secret alter ego, it’s not a conspiracy because he’s the only one who knows. The alter-ego doesn’t count as a person for purposes of the definition of a conspiracy.
On the other hand, most respectable people believe that the DNC and Sen. McCaskill worked behind the scenes to undermine viable GOP campaigns to get Rep. Akin as her opponent in last year’s election. That’s technically a conspiracy theory but it’s one hundred percent respectable.
I didn’t mean Tyler. I meant other progressive wonks. I just see little in his background to make him this master analyst, although that doesn’t mean he isn’t.
How much of the healthcare slow down is due to the minor baby bust in the States? Could some of the death of retail (Borders, Circuit City, Best Buy) also be contributing to the slowdown as well. Now clinics can find cheaper commerical real estate openings as opposed to building new ones.
1. What is bizarre to me is the seeming steady fall in quality of venerable brands. Breyer’s no longer contains enough cream to qualify for the name “ice cream”, candy bars are getting smaller and crappier, etc. One would expect that as incomes increase over the years people would demand higher quality products, not the reverse.
It just seems to me that many of the sweets and things are trying to avoid appearing to inflate based on price to preserve brand loyalty and avoid sticker shock. Another example from the ’90s are the Haagen Dazs chocolate-covered ice cream bars that I used to love. I hadn’t had one in about ten years, so I bought a box a few months ago, and they’ve greatly reduced the size of the box by literally scaling down all the bars to maybe 50% of their original volume. However, the nominal price has remained the same.
Some quick googling has suggested that the actual Haagen Dazs “pint” is now 14 oz rather than 16 oz because of changed packaging.
The thing that really struck me as bizarre in that article is that he likes to buy vanilla ice cream in 4-5 quart vats. I get the lower price of buying Snickers bars by the box. And ice cream in mass quantities is also cheaper. But unless he’s eating a lot of ice cream a day (or has a substantial family), that ice cream will get riddled with ice crystals from sitting in the freezer so long.
Even as a confirmed ice cream addict living in Boston during the golden age when Steve’s, Herrell’s, Emack & Bolio’s, and especially Toscanini’s took over Boston and Cambridge, I’d average maybe 2 pints a week, sometimes 3. A 4-5 quart vat would simply take too long to finish. And that was when I was young and didn’t have to worry about calories.
The snickers link is why “Assorted Links” is one of my favorite posts. I love the obsessive nature of the article. I like snickers bars; they’re one of my favorite after/during hiking snacks.
Agreed, Snickers bars were great for exam day. Their sugar-fat-protein profile meant that eating one an hour before you started testing meant that you could have your brain running at high levels for hours and still get everything done without a crash in the middle.
It’s really hard for me to square this spending data with the claims cost trend I’ve been seeing.
Getting off topic a bit, but to go back to your “dinner with Fucshia Dunlop” – which I never commented on – my wife would be extremely jealous and angry if I had dinner with another woman who was not related to me or was not strictly work related and required (like a job interview). Otherwise, other people would have to be there with us.
I guess your dinner with Dunlop was sort of work related, but couldn’t you have met at your office? Would your wife let you travel to China with her to visit the best restaurants?
I actually enjoy cooking good food more than eating it. Of course, I sample while cooking – you can’t do a good meal without that feedback loop, unless you’re a pro – but the fun part is the doing. And especially when guests are surprised that a single white guy who works in IT can do quality Thai food (like you’d eat in Thailand, not in some lunch place) as easily as a Texas chili, although I admit that is more popular with guests than with me. (Lately, my lunches tend to be crockpot beans and rice, beef, because my doctor told me to eat more, whatever veggies need to be used up, all cooking in broth that sits on the stove most of the time. And judgemental spicing. Always start with a bay leaf, if it is western cooking. It isn’t hard.)
Re the (old) gastro-nihilist piece (#4): I have often thought about this position, and would rephrase the position like this:
“What would it be worth to you, to: never have to spend X minutes/day eating, never have to worry about what to eat (i.e. which foods currently are deemed dangerous to your health, what foods will your friends ridicule you for eating, etc.), and never have to worry again about the exercise debt you are incurring by eating food A versus food B?” If the price of this liberation from eating were simply giving up the sensory pleasure that eating tasty food brings — I would take the deal in a heartbeat (word chosen carefully). I look at every meal now as a challenge: some ingredient will shorten my life, another one is worse, or a different medical professional considers it actually better, eating item x will deplete the oceans, eating item y will impoverish farmers in Peru, eating item z will make me fat, eating item alpha will hurt local farmers, eating item y will raise my blood pressure…. wouldn’t it be wonderful to be able to make this all just go away? I must be a gastro-nihilist.
One big reason hospital construction is down: increasingly, and for many reasons including less-invasive technologies, procedures once done at a hospital are being moved to outpatient clinics. As usual, things are not as simple as they seem.
On #6 Sumner says 4 things have to be true for Krugman to be correct. 2 of the 4 seem true right off the bat:
2. He says the owners get the income eventually. This is true in a way but is he saying the owners are going to spend now based on that future promise? Even with all the other uncertainty going on that may impact share price. I don’t believe it.
4. Bernanke allows inflation to decline. Ah so the zero lower bound is irrelevant then? We can just wave our wand get whatever level of inflation we want? I don’t believe that either.
Then I am not sure this one is even valid:
3. Taking cash out of circulation decreases velocity. Even if velocity does increase will that totally offset the monetary decrease? And doesn’t #4 cover #3 already?
On #1 I am not even sure what he is talking about… MPS?
I am having a hard time believing the idea that saving cannot affect aggregate demand. If literally everyone started saving (just stopped making any non-essential purchases) doesn’t AG have to go down? What am I missing here?
Ezra Klein seems to be too knowledge and too honest to be a Democrat or a journalist and also not sensationalist enough to be a journalist and yet there he is. BTW the other journalists (like politicians) only seem stupid because it pays.
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