Results for “age of em” 17235 found
Is there ACA rate shock in California?
I wasn’t going to weigh in on this, but enough of you have asked me what I think of Avik Roy’s claim that California insurance premiums, under ACA, will go up 64% to 146%. Let me start by telling you this: based on a reading of the secondary commentary, I cannot tell you how much rates in California will be going up (and my original inclination was not to blog it for this reason).
Still, the question having been raised, let’s go back in time. In 2009, the CBO wrote (pdf):
CBO and JCT estimate that the average premium per person covered (including dependents) for new nongroup policies would be about 10 percent to 13 percent higher in 2016 than the average premium for nongroup coverage in that same year under current law.
About half of those enrollees would receive government subsidies that would reduce their costs well below the premiums that would be charged for such policies under current law.
If you read their subsequent discussion, it seems fairly clear to me they are not averaging “higher premia for those still getting insurance” with “a price decline from infinity, for those who couldn’t get any insurance in the pre-ACA days,” in some kind of complicated index number fashion. They are talking about price increases on already-existing policies and what kind of continuation one can expect.
I will treat this as the canonical estimate, and stipulate that we will have had “rate shock” if the percentage increases are three times higher than had been forecast by the CBO.
You will note that these higher rates still may be an efficient form of lump sum taxation, or they may be unsustainable price hikes which cause the mandate to unravel (read Will on this point) by encouraging non-participation, or perhaps a bit of both. Megan McArdle considers some public choice implications of unpopular and unexpected high rates.
In 2009, you will find a claim by Jonathan Gruber:
What we know for sure the bill will do is that it will lower the cost of buying non-group health insurance.
Maybe he had in mind an index-number weighting where the “price decline from infinity” weighs heavily in the calculation and in that sense such a claim can always be true if even one person receives extra coverage. Still, I am more likely to call it a misspoken sentence, a Denkfehler, an excess enthusiasm, and most of all a highly inexact way of describing the issue no matter what is the truth. It was always the case that the median and modal individual premium was likely to go up, even with full political cooperation from the Republicans. After all, that is part of the “efficient lump sum taxation” idea behind the use of the mandate in the first place. And yes I do understand that a competitiveness effect and a transparency effect still may push prices down but that is not the way I would bet it and for sure it is not “for sure,” to quote Gruber, that such prices are going to fall. (By the way here is an Indiana estimate of rate increases in the range of 70-90%; I can’t vouch for the underlying data. It also seems that price declines are highly likely for New York state, in part because the current system has so many problems. So we also need to be disaggregating the different states here. Also, here is some informal poll evidence for a 30-40% rate increase at the individual level, with some higher increases for some other groups. Caveat emptor, but those would be higher rates and they might even surpass the 3x standard I have set up.)
If you add in President Obama’s varied comments on the matter, I absolutely do see the real truth behind conservative and Republican complaints of “bait and switch.” The median and modal cost of buying non-group health insurance is likely to go up, not down, and not everyone will enjoy the option of keeping the status quo, as had been promised. And that whole matter is being given a different spin today than it was say in 2009. On that Roy is entirely correct.
(In passing, I see employer shedding of coverage as a greater danger to ACA at the macro level, so in my view it is a mistake to see too much of ACA as turning on this issue.)
On the other side of the debate, you will find criticisms of Roy here, here, here, here, and here, among many others. At least two points of the critics seem to stick, first that these may be teaser (status quo) rates sampled by Roy and second we don’t know actually which individuals can end up getting those rates, once they fill out the questionnaires about the earlier medical histories. But even there we are left with “we don’t know” more than “I have better numbers which show Roy to be wrong.” The level of subsidies is relevant too. I think also that Roy’s response undercounts the number of uninsurable people. The worry is not that the market price for insurance is infinite, but rather at the prevailing market price one is simply paying one’s medical bills, plus a processing premium to the insurance company, rather than obtaining ex ante insurance.
To raise two other points critical of Roy’s position, first I am uncomfortable with putting so much emphasis on percentage rate increases, when some of these sums in question may be relatively small. (I find the emphases in Megan’s presentation of the numbers more useful.) I also think it requires a lot more argumentation to measure the number of “those who can’t get useful insurance” than by looking at the number of applications for the high-risk pools, even if that argument ultimately succeeds.
That all said, I find the screeds of most but not all of Roy’s critics to be inappropriate or in some cases beyond inappropriate. It is disturbing how much space and emotional energy is devoted to attacking Roy, and to attacking conservative policy wonkery, relative to trying to calculate the actual extent of rate shock or possible lack thereof. That is not how good policy wonks go about their job.
I think there is quite a good chance we will see rate shock, as I have defined it above. I also think we still don’t know. I also see rhetorical bait and switch from ACA defenders. I also see that Roy is too quick to jump on possible negative information about the California rates without nailing down the case. I also don’t think these are the most important issues for ACA, though they are issues worth discussing.
Overall this is not a debate which is going very well.
How depressing is the moral regression of Syria?
Syria is undergoing moral regression (one NYT update here), just as Lebanon did in the 1970s or the former Yugoslavia did in the 1990s or for that matter Germany in the 1930s. The behavior of the government is far more evil and oppressive than before, while the moral quality of the opposition is worse than what we might have expected several decades ago.
That said, most of the world is not regressing morally and arguably can be seen as advancing morally, at least on the fronts of general tolerance, democracy, and the moral virtues which are encouraged by prosperity and market exchange.
Syria is only a small percentage of the broader world and there are only a few other places which count as (possibly) morally regressing. In total they will not sum to a billion people. Just for purposes of argument, if you toss in DRC and parts of Pakistan and Egypt, along with a few other areas, let us say it runs at five percent of the world’s population which is morally regressing (though DRC has made some very recent progress and is arguably the new undervalued nation).
One worry is that observed regression draws our attention to the contingency of moral progress. It can be argued whether Syria is one data point or millions of data points. I don’t understand very well what observed moral progress is contingent upon, and the histories of Germany and Yugoslavia make this especially tough. Both locales seemed to have bright futures when they fell apart, morally speaking that is. So I am not all cocky about moral progress continuing indefinitely.
Is it possible there is more moral regression in the world today than say five years ago? Does moral regression have a unit root? Serial autocorrelation? Do we understand the causes of moral regression better as time passes? I don’t see that.
Another worry is how well the rest of the world can cope with five (?) percent of its citizens undergoing moral regression. “Quite fine” it seems so far, although this may be contingent on technology and furthermore Israel and Lebanon may not feel the same way. In any case the moral regression of Syria may be a more serious problem when insect-sized drones can enable strategic assassinations, including outside of Syria.
The technologies and prices of fifty years from now may require much higher moral standards of us — “every man a Denmark” — than the world of today. More generally, we dismiss the possibility of moral regression at our peril.
For a useful conversation on this topic I am indebted to SL.
Partisan Bias Diminishes When Partisans Pay
In November of last year I wrote:
Overall, I am for betting because I am against bullshit. Bullshit is polluting our discourse and drowning the facts. A bet costs the bullshitter more than the non-bullshitter so the willingness to bet signals honest belief. A bet is a tax on bullshit; and it is a just tax, tribute paid by the bullshitters to those with genuine knowledge.
A recent paper provides evidence. It’s well known that Democrats and Republicans give different answers to even basic factual questions when those questions are politically loaded (Did inflation fall under Reagan? Were WMDs found in Iraq? and so forth). But do the respondents really believe their answers or are they simply signalling their affiliations? In other words, are respondents bullshitting? In a new paper, Bullock, Gerber, Huber and Hill provide evidence that the respondents don’t actually believe what they say and the authors do so by making partisans pay for their beliefs. Dylan Matthews at Wonkblog has a good writeup:
They ran two experiments. In the first, they split respondents into two groups: Those in the control group were asked basic factual questions about politics; those in the treatment group were asked the same questions but were entered into a raffle for an Amazon gift card wherein their chances depended on how many questions they got right.
In the control group, the authors find what Bartels, Nyhan and Reifler found: There are big partisan gaps in the accuracy of responses.
…But when there was money on the line, the size of the gaps shrank by 55 percent. The researchers ran another experiment, in which they increased the odds of winning for those who answered the questions correctly but also offered a smaller reward to those who answered “don’t know” rather than answering falsely. The partisan gaps narrowed by 80 percent.
The paper also has implications for democracy. Voting is just another survey without individual consequence so voting encourages expressions of rational irrationality and it’s no surprise why democracies choose bad policies.
Hat tip: @jneeley78.
What technology exists that most people probably don’t know about & would totally blow their minds?
That is the title of a new Reddit thread, reproduced here. Overall I am not blown away by the nominations and I find few of them in my own everyday life. Here is one example:
ALON – transparent aluminium, you can have a window that don’t break!!!
Here is further information, with photos. Cool enough, but not as good as cheap quality education and health care. And it costs 20k per square meter, at least according to that article.
I’m ready to call the great stagnation over when driverless cars are in the hands of the middle class, but that’s still a while away. Steady deflation for education and health care expenditures would do it too, and I can see this will come for education but not for health care. As for Google Glass, I will review it once they sell me one. I’d also claim the end of stagnation if we saw a 2% yearly rise in the median real wage on a sustained basis, say most of the years out of a ten-year period.
In the meantime, here is a robot which pours you a beer.
For the pointer I thank Max Roser.
Do not bargain with round numbers
When negotiating for a salary, most of us reach for a nice, round number like $65,000. Or $90,000. Or $120,000.
But, by favoring all those zeros, we may be missing an opportunity to score a better deal, according to a new paper from researchers at Columbia Business School. They found that using more precise numbers in an initial request—or anchor, as it is known in negotiating parlance—generally results in a higher final settlement.
Precision conveys the impression that the job candidate has done extensive research and deeply understands the market for his services, said Malia Mason, the lead author of the paper and a professor at Columbia who teaches a course on managerial negotiations. When people use round numbers, by contrast, they’re conveying that they have only a general sense of the market rate for their skills.
…In one experiment, Ms. Mason and her team had 130 sets of people negotiate the price of a used car. When buyers suggested a round anchor, they ended up paying an average of $2,963 more than their initial offer. But buyers who suggested a precise number for a first offer paid only $2,256 more, on average, than that number in the end.
When it comes to negotiating salary, Ms. Mason’s research indicates that a job candidate asking for $63,500 might receive a counteroffer of $62,000, while the request for $65,000 is more likely to yield a counteroffer of, say, $60,000, as the hiring manager assumes the candidate has thrown out a broad ballpark estimate.
There is more here, Mason’s home page is here. The paper itself is here. Here is her TEDx talk on mindwandering.
Micah Tillman defends Edmund Husserl
I allowed him three paragraphs, and he emails me the following:
Husserl was a mathematician whose desire to understand how (and why) mathematics actually works turned him into a philosopher of logic, science, language, and mind. Without the movement he inaugurated, Heidegger (and therefore everyone who followed Heidegger), Merleau-Ponty, Sartre, Levinas, and Derrida (and even John Paul II) would not have become the philosophers we know them as today.
Husserl was inspired by Hume and Kant, but believed both made a fundamental mistake. Empiricists like Hume became skeptics after concluding that all we truly know are our own sensations; we never experience the “real things” we think we do. Idealists like Kant essentially agreed (we experience only phenomena, never noumena) but believed that at least we could discover the universal rules of the human mind.
Husserl argued that the “things themselves” actually show up for us through our experiences and therefore we can learn about the real world through a study of the structures (patterns, types, and forms) of human experience. In the process, he reconciled empiricism and idealism. The empiricist insistence on experience over speculation is central to phenomenology, as is the idealist claim that the study of the mind is the path to knowledge of ultimate reality. With the combination of the two, every area of the world, and every part of life, became a subject for philosophical investigation, and philosophy experienced a kind of second birth.
Earlier I had named Husserl as “the worst philosopher.” But of course I am delighted to present a contrasting view. Micah is a professional philosopher and an adherent of phenomenology, his web page is here. His recently completed dissertation was “Empty and Filled Intentions in Husserl’s Early Work.” He describes the “things themselves” — in less than 140 characters — here.
Assorted links
1. Is Alan Jacobs a conservative?
2. The great stagnation in Australia.
3. Is the multiverse hypothesis becoming more popular?
4. Dmitry Itskov and his quest for avatar uploads.
5. Your view of the past is less distorted when you can watch it in color.
How much should we be fearing “resets”?
It is a common observation that nominal wages are sticky but let’s not forget that real wages are often sticky too (and in fact nominal stickiness tends to matter much more when accompanied by real stickiness, but that is a point for another day.) That means many labor market changes will be slow to manifest themselves in the real world. Furthermore you often will see them first for new jobs, for the young, and for new labor market entrants (usually but not always the young).
To cite one example, commentators are debating whether Obamacare will induce employers to “shed” insurance coverage, given that the workers can be picked up by the subsidized exchanges (and the fines, where applicable, are relatively low). Probably we won’t know the size of this effect until we have had a fairly full set of job “turnovers” in labor markets, as many employers will be reluctant to upset previous explicit or implicit deals.
Circa 2013, I fear many of the pending reset deals in labor markets. Insiders are often treated quite well, but the next generation of outsiders may never reattain such privileged positions. The average doesn’t change very rapidly, because most of the employed still are insiders. Still, we can see that the reset may be a doozy. After all, labor’s share as a percentage of gdp has been falling in many of the advanced economies around the world.
Even putting cyclicality aside, Greek and Italian youth worry about exactly this problem. Any aspiring academic in the United States should worry about the reset too, with or without MOOCs. Especially in the humanities, the old privileged positions simply aren’t being replicated because for most schools those positions no longer make economic sense. At the same time, few if any tenured professors are taking significant real wage cuts.
Resets show up more quickly in some sectors than others, most of all they come quickly when buyers and sellers have only sporadic and perhaps even anonymous contact with each other. In other words, the reset comes more slowly for the mistress than for the street prostitute. And when you see youth losing relative ground in labor markets, that is another signal that you should be worrying about resets.
Fear the reset. The world will continue to produce much more value, and much more gdp, but who will capture that value is already changing dramatically and will continue to do so.
Addendum: Here is commentary from Ashok, and also from Luis Pedro Coelho. And from On Demand.
How to save the world — earn more and give it away
Dylan Matthews reports:
Jason Trigg went into finance because he is after money — as much as he can earn.
The 25-year-old certainly had other career options. An MIT computer science graduate, he could be writing software for the next tech giant. Or he might have gone into academia in computing or applied math or even biology. He could literally be working to cure cancer.
Instead, he goes to work each morning for a high-frequency trading firm. It’s a hedge fund on steroids. He writes software that turns a lot of money into even more money. For his labors, he reaps an uptown salary — and over time his earning potential is unbounded. It’s all part of the plan.
Why this compulsion? It’s not for fast cars or fancy houses. Trigg makes money just to give it away. His logic is simple: The more he makes, the more good he can do.
He’s figured out just how to take measure of his contribution. His outlet of choice is the Against Malaria Foundation, considered one of the world’s most effective charities. It estimates that a $2,500 donation can save one life. A quantitative analyst at Trigg’s hedge fund can earn well more than $100,000 a year. By giving away half of a high finance salary, Trigg says, he can save many more lives than he could on an academic’s salary.
…In many ways, his life still resembles that of a graduate student. He lives with three roommates. He walks to work. And he doesn’t feel in any way deprived. “I wouldn’t know how to spend a large amount of money,” he says.
The full story is here. Here is commentary from Salam and Sanchez. And I have just received the new book by Michael M. Weinstein and Ralph M. Bradburd, The Robin Hood Rules for Smart Giving, an analytical treatment written by two economists.
Do Japanese companies have banishment rooms?
This seems speculative, but of interest nonetheless:
Basically, banishment rooms are departments where companies transfer surplus employees and give them menial or useless tasks or even nothing to do until they become depressed or disheartened enough to quit on their own, thus not getting full benefits, unlike if they were actually let go. Imagine having to stare at a TV monitor for 10 hours at a time each day, in order to look for “program footage irregularities.” Of course companies would not admit to doing this, and instead will make up generic (or even creative) titles and department names like “Business & Human Resource Development Center” or “career development team”. And it’s not small companies that are doing this, but big ones like Hitachi Ltd., Sony Corp., Toshiba Corp., Seiko Instruments Inc., a NEC Corp. subsidiary, and two subsidiaries of Panasonic Corp.
A public relations from the main office of Panasonic said that the BHC section is “training employees to acquire new skills so they can work at different sections,”. 468 employees were added to this department in April, mostly coming from sections that were doing poorly. In short, 1 in 10 workers at the company are at the BHC. So far, only 35 employees have left the company while 29 got transferred to other departments.
Via Mark Thorson, the story is here. Here is another article about banishment rooms, with more documentation and more legal detail about the difficulties of firing employees.
Elsewhere from Japan, a new and possibly very effective malaria vaccine has been invented. Here is electronic Samurai sword quick draw and cut trainers. Here is an argument that competitive vending machines make Japanese inflation more difficult to achieve.
Assorted links
1. Bill Bonner believes in economic stagnation (and wants to sell me short).
2. The culinary wonders of Hudson County, New Jersey (and the article barely scratches the surface).
3. Ross Douthat on reform conservatism.
4. DOT makes a statement on self-driving cars.
5. Alberto Mingardi will guest blog at EconLog.
6. Does political ideology affect experts’ judgments of the aesthetic quality of chess games?, the published and gated version is here.
We are not as wealthy as we thought we were (a continuing series)
From Ylan Q. Mui at The Washington Post:
American households have rebuilt less than half of the wealth lost during the recession, according to a new analysis from the Federal Reserve, hampering the country’s economic recovery.
The research from the St. Louis Fed shows that households had accumulated net worth totaling $66 trillion at the end of last year. After adjusting for inflation and population growth, the bank found that meant families on average have only made up 45 percent of the decline in their net worth since the peak of the boom in 2007.
In addition, most of the improvement was due to gains in the stock market, according to the report, primarily benefiting wealthy families. That means the recovery for most households was even weaker.
“A conclusion that the financial damage of the crisis and recession largely has been repaired is not justified,” the report stated.
Markets in Everything: AER Publication
From EJMR:
I have a new paper that I consider my best work. For a variety of reasons, the marginal return professionally for this paper is very small for me. But I think it has an excellent shot a top
journal, I would estimate 1/3 at the AER (I have published there before). So I am offering it for sale. Here are the details:1. This paper is not yet posted on my website. It has not been circulated and I have not yet presented it.
2. The paper is applied micro although I will sell it to anyone.
3. Email bids to [email protected]. Use a fake account and make sure to send no revealing information.
4. Your bid is for an AER or QJE. If it ends in Restud, you pay 65%. If it ends in the Journal of Labor Economics, Journal of Public Economics, or EJ, you pay 35%. Other journals are negotiable. You can choose the submission path as long as it starts with one of the top journals.
5. I will contact the winning bid (or highest real bid) to arrange an in person meeting in Philly at the meetings. We will never leave a paper trail.
6. Half of payment is due with a revise and resubmit. I will also make the needed changes. The final half is due with final acceptance.
7. Spare me any discussion of the ethics here. I am dead serious and I will not be commenting further on this thread.
The whole thing could be a troll or an experiment but let’s assume it’s real. An AER could easily be worth 50k, especially for someone early in their career but that’s for one you wrote yourself. An AER written by someone else has a significantly lower expected value since, if revealed, it may end your career. Moreover, suppose the buyer, as unlikely as it seems, takes advantage of the big push and makes it big on their own. Is the buyer not then vulnerable to blackmail from the seller who already has signaled their ethics? I can see this appealing, however, to the scion of some dictator who could afford to pay well over 50k and also afford to make the seller pay if the secret is revealed. Caveat emptor and also caveat venditor. True, there are not many econ PhDs among the dictator set but there are a few and sadly this kind of thing does have precedents.
P.S. I did like the discounting by journal, a nice, accurate touch.
Do anonymous donors signal higher status?
Here is a summary of some recent work by Mike Peacey and Michael Sanders:
New research that studied why people choose to make large donations to charity anonymously has found that it may act as a signal to other donors of the charity’s quality. The findings, published today, also show that anonymous gifts rather than public ones induce larger donations from subsequent donors.…the researchers indicate that the reason why a person may choose to show the amount they have donated but conceal their identity is because it may act as a signal informing others looking to donate of the charity’s quality and worthiness. Knowing this to be the case, a donor who wishes to see the charity succeed may intentionally choose to keep their identity private.
The findings also reveal that early donations are more likely to be anonymous than later ones, particularly for the first to a fundraising page.
Very good sentences
This raises an interesting, tangentially related question. Liberals fulminate constantly against outrageous conservative obstruction, yet often seem nevertheless surprised by its effectiveness. Why is that? My guess is that liberals are sometimes deceived by assumptions about the scope of liberalising moral progress. Modern history is a series of conservative disappointments, and the trend of social change does have a generally liberal cast. The surprisingly rapid acceptance of legal gay marriage is a good example. Liberals are therefore accustomed to a giddy sense of riding at the vanguard of history, routed reactionaries choking in their dust. But all of us, whatever our colours, overestimate the moral and intellectual coherence of our political convictions. We’re inclined to see meaningful internal connections between our opinions—between our views on abortion and regulatory policy, say—when often there’s no connection deeper than the contingent expediencies of coalition politics. For liberals, this sometimes plays out as a tendency to see resistance to all liberal policy as an inevitably losing battle against the inexorable tide of history. This occasionally leads, in turn, to a slightly naive sense of surprise when a hard-won political victory isn’t consolidated by a decisive, validating shift in public opinion, but instead begins to be ratcheted back.
That is from Will Wilkinson.