Month: June 2007

My favorite things Quebecois

No, I am not there, but I am catching up on requests from loyal MR readers.  Today I will set this one right:

Pianist: Oscar Peterson.  His best albums are The Trio and the set with Joe Pass at Salle Pleyel.  For all his talent, many of his CDs are quite boring.  On another front, I usually don’t like Marc-Andre Hamelin.  Despite the critical raves, I find him icy cold, enjoying only his rendition of the Scriabin sonatas.

William Shatner performance: I will opt for "City on the Edge of Forever."  (NB: I haven’t yet seen "Incubus".)

Actress:  Genevieve Bujold, most of all in Cronenberg’s Dead Ringers.

Popular music: I don’t much like Leonard Cohen or Celine Dion.  Rufus Wainwright is OK.  Arcade Fire is OK.  Help me out here people…

Author: Saul Bellow wins hands down, though he is not a personal favorite.

Philosopher: Charles Taylor.  There is also G.A Cohen, though I have to put him on my "totally wrong about everything" list.

Linguist: Steven Pinker.

Movie Director: Mack Sennett, and yes I used Google/Wikipedia to find that one.

Painter: This guy would be the mainstream pick.  I’m holding out for one of the strange naives, but the name escapes me.

The bottom line: I must be linguistically limited, because most of these names come from English-speaking families.  It is also striking how many thorough web sites exist, dedicated to nothing but listing the many famous and meritorious Quebecois.

When you forget someone’s name

Sadly this problem plagues me more than it used to, though I never forget the location of a restaurant.  Gretchen, at The Happiness Project, has a few suggestions:

1. The “I know your name, but I’m blocked” dodge:
“I keep wanting to call you "David," but I know that’s not right.”

2. The “Of course I know you — in fact, I want all your information” dodge:
“Hey, I’d love to get your card.”

3. The “The tip of my tongue” dodge:
“I know I know your name, but I’m blanking right now.”

4. The “You’re brilliant!” dodge:
“Wow, you have a terrific memory. I can’t believe you remember my name
from that meeting six months ago. I can’t remember the names of people
I met yesterday! So of course I have to ask you your name.”

5. The “Sure, I remember you” dodge:
“Remind me – what’s your last name?” If you ask a person for his last name, he’s likely to repeat both names. “Doe, John Doe.”

6. The “One-sided introduction” dodge:
“Hey,” you say to the person whose name you can’t remember, “let me
introduce you to Pat Smith.” You introduce the two and say the name of
the person whose name you remember. Almost always, the nameless person
will volunteer his or her name.

I have tried asking the person how his or her name should be spelled (if the name is too simple that one can backfire), or "when you publish articles, how much of your full name do you give?" 

Do you all have better ideas? 

The best sentence I reread this morning

While he is willing to attribute some of the rising wage inequality of
the 1980s to trade with developing countries, the timing of the
increase in profits since 2000 does not seem to fit very neatly with
any globalization-related story.

That is from Dani Rodrik.  Mark Thoma offers related material.  Brad DeLong makes excellent points in one of his best posts.

Smart thoughts on health care

Overall, I’d like to see no insurance or government programs for most
routine care.  I think a retail medical system would end up looking like
eye care does now, with lots of variety and innovation.  It would also
be more convenient and cheaper.  This type of primary care would
probably be just as effective as what we have now.  If people with
borderline medical conditions visited the doctor more often (because it
was cheap and convenient), care might even be more effective than it is

Here is much more.  The author has spent most of his life in a wheelchair, and he has a great deal of personal experience with the U.S. health care system.

A prize for the Edwards plan?

I am awaiting details but this proposal from John Edwards is not entirely crazy.

Mr. Edwards said he wanted to discourage pharmaceutical companies from
obtaining long-term patents on medicines for specific ailments like
Alzheimer’s and cancer. Instead, an upfront cash prize would be made
available to serve as an incentive for research on such drugs.

I worry, however, that the prizes will be far too small.  Since the social value of breakthrough medicines greatly exceeds the private profit, prizes of tens of billions of dollars would not be unreasonable.  In fact, optimal prizes must increase the profits of US drug companies.  Can a Democrat like Edwards sell that?  And who will decide how the prizes are handed out?  Can the US government award billions of dollars in prizes without significant rent seeking?

Partly for these reasons, I would much prefer a patent buyout as suggested by Michael Kremer (Kremer’s paper can also be found in Entrepreneurial Economics.)  Let’s at least have a few experiments to buyout say 5 years of the time remaining on some important patents.

Do keep in mind that the problem of expensive drugs is overblown – a typical new drug will go off patent in 12 years anyway.  The real issue is how best to increase the incentive to develop new and important pharmaceuticals.

Women and wealth

This new NBER working paper has an abstract in which every sentence is interesting:

The extent of and changes in inter-generational mobility of wealth are central to understanding dynamics of wealth inequality but hard to measure.  Using estate tax returns data, we observe that the share of women among the very wealthy (top 0.01%) in the United States peaked in the late 1960s, reaching almost 50%.  Three decades on, women’s share had declined to one third, a return to pre-war levels.  We argue that this pattern mirrors the relative importance of inherited vs. self-made wealth in the economy and thus the gender-composition of the wealthiest may serve as a proxy for inter-generational wealth mobility.  This proxy for "dynastic wealth” suggests that wealth mobility in the past century decreased until the 1970s and rose thereafter, a pattern consistent with technological change driving long term trends in income inequality and mobility.  Greater wealth mobility in recent decades is also consistent with the simultaneous rise in top income shares and relatively stable wealth concentration.

Do note the wealth mobility discussed toward the end might be occurring only among the relatively rich, as described by Pareto’s "circulation of elites."  The pointer is from the "still excellent but why doesn’t he post more?" New Economist blog, which also references related work about the UK.

The researcher is Lena Edlund, here is her home page.  Here is her article "Hermaphroditism: What’s Not to Like?"  If you are in the popular press and are looking for a fascinating, undercovered economist to profile, try Lena Edlund.  Here is her paper on "Sex and the City."  Here is her paper on why "love marriage," as opposed to arranged marriage, is good for the economy.

The Economic Naturalist, part II

Why do women’s clothes always button from the left, while men’s clothes always button from the right?

…This is an example in which history really seems to matter.  When buttons first appeared in the seventeenth century, they were seen only on garments of the wealthy.  At that time it was the custom for men to dress themselves and for women to be dressed by servants.  Having women’s shirts button from the left thus made things easier for the mostly right-handed servants who dressed them…

Might there be a continuing rational reason for this difference, namely that the women’s approach looks better (does it?) but is harder, thus scaring off the men?  This sounds like a question for Fashion-Incubator.

In any case that excerpt is from Robert Frank’s new The Economic Naturalist.  Here is Craig Newmark’s review of the book.  Here is Brad DeLong on the book.  Here is my previous post on the book.

Sanity about guest workers, from James Surowiecki

Guest workers are also, paradoxically, less likely than illegal immigrants to become permanent residents.  The U.S. already has a number of smaller–and less well-designed–temporary-worker programs, and there’s no evidence that workers in those plans routinely overstay their visas.  Mexican workers, contrary to popular belief, do not, generally, intend to live their entire lives in the U.S.  Instead, as the sociologists Douglas Massey and Jorge Durand concluded after a comprehensive study of immigrant attitudes and behavior, most want to work “for short periods to generate an alternative source of household income . . . or to accumulate savings for a specific purpose,” like buying a house in Mexico.  This is harder to do as an illegal immigrant than as a guest worker, both because illegal workers are paid less and because when an illegal goes home he runs the risk of getting caught.  One remarkable study found that after border enforcement was stepped up in 1993 the chances of an illegal immigrant returning to Mexico to stay fell by a third.

Here is the full piece.  Please leave comments of high quality.  Let’s try two new norms for comments.  First, don’t say anything stronger against another commenter (or blogger) than "I don’t agree with you John."  Second, it is fine if you are commenting on a single thread more than once, but you should be adding new arguments and material, not just debating with another commenter.

Addendum: Megan Non-McArdle makes excellent points about civility.

How Should the FDA Incentivize?

The FDA often wants manufacturers to provide additional studies such as for pediatric uses or for testing of off-label uses of already approved drugs.  How should the FDA incentivize these studies?  Long-time reader Steve (who has good reason to know and thus shall otherwise remain anonymous) writes:

I was reading an article about pediatric drug testing and the BPCA, and I had an epiphany–the people at the 
table don’t have the incentives necessary to solve the problem.

…possible solutions to the problem of limited pediatric testing appear to boil down to: 1) Modify the reward (primarily through exclusivity); 2) 
Give out grants; and 3) Force studies through a government mandate. 
These solutions reflect the interests of the three groups sitting at 
the bargaining table, i.e., 1) Big pharma, 2) Academics, and 3) 
Bureaucrats. What is totally missing is the idea that incentives can be created on both the risk and reward side of the equation. … For example, if the FDA fast-
tracked NDAs with pediatric data, and guaranteed a decision in 90 days, they could, with minimal cost, cause a major shift in incentives. 

    …Any thoughts on how the situation can be improved?

The FDA significantly raises the costs of creating new drugs – there are some benefits in better safety and efficacy but I think the current system results in too much drug lag and drug loss.  I would cut back on FDA regulation considerably but I am not against more government-financed studies of safety and efficacy.  Once a drug is on the market and especially when it is off-patent, knowledge about the drug is a public good and thus often underprovided.  I would thus reduce the FDA’s control over drug choice but increase the budget for drug information e.g. through NIH financed studies like the Women’s Health Initiative which shockingly showed that then widely used homorone replacement therapy increased not decreased coronary disease.