Market Power

Human vs. Animal Health Care

Here's a very interesting chart showing health care expenditures on animals and humans.

This is from Andrew Briggs at the Enterprise blog (via Megan McArdle).  He got the veterinary data from the consumer expenditure survey and the human health expenditures from the National Income and Product Accounts.  McArdle argues:

Veterinary spending is rising just about in line with human medical spending.  Kudoes to AEI for publishing a graph that seriously undercuts one of the major conservative arguments about health care:  that the main problem is consumers who don't bear their own costs.  Veterinary spending is subject to few of the perversities that either left or right suppose to be the main problems afflicting health care spending.  Consumers pay full frieght most of the time.  They are price sensitive, and will let the patient die if keeping him alive costs too much.  There is no adverse selection.  There is no free riding on mandatory care.  Government regulation is minimal.  Malpractice suits are minimal, and have low payouts.  So why is vet spending rising along with human spending?

For those interested, here's a useful powerpoint presentation that describes what the NHE data show.  Here's the (I think) data Mr. Briggs used for his chart (third link below "downloads). 

Keep in mind that the scale on the vertical axes are very different here.  The lefthand side increases by $2,000,000,000 increments, the righthand side increases by $500,000,000,000.  Much more is spent on the care of humans than on animals.  I would be interested to see how much is spent per pet for veterinary services and how much is spent per person for medical care. 

Also, veterinary services don't include the cost of medicine for pets.  Adding this in, I realize, would not change things very much, but it would make for a more apples-to-apples comparison.

Update:  Greg Mankiw writes

These data are consistent with what I wrote a couple years ago: "The reason that we spend more [on healthcare] than our grandparents did is not waste, fraud and abuse, but advances in medical technology and growth in incomes. Science has consistently found new ways to extend and improve our lives. Wonderful as they are, they do not come cheap. Fortunately, our incomes are growing, and it makes sense to spend this growing prosperity on better health."

If so, then medical costs are not spiraling out of control relative to what we get in return for our expenditures.

The Economic Impact of 9-11

This volume contains eight studies that provide a definitive range of estimates of the economic impacts of 9/11. The collection of papers represent the outcome of a collaborative and iterative research process known as the CREATE Economic Impact Modeling Forum (EIMF).

Here is the link.  Via King.

"A Good Paper Topic for an Ambitious Grad Student"

Here.

Virginia Postrel on Kidney Donations

Her excellent column is here.  HT Glenn Reynolds.

I've written before on how a legal market for human organs, and not just kidneys, would save lives.  But ethicists insist that having people pay for organs is unethical (yet they don't seem to mind paying transplant doctors).  So we have laws that make it illegal to trade organs for money.  Only donation is allowed.  The result includes excruciating waits for patients and, oftentimes, deaths.  How is that morally superior to a functioning market?

Update:  Greg Mankiw writes "What market has 80,000 potential consumers each demanding one unit, 300,000,000 potential producers each capable of supplying one unit, and a shortage nonetheless?"

WSJ Poll of Economists on the Need for Another Stimulus

Most surveyed said "no."

Edward Lazear on Whether We Need Another Stimulus

Prof. Lazear says "no," and argues that the stimulus really wasn't much about stimulating the economy anyways.  If it were, he argues, then the spending should have been made up front, not written into future budgets. 

It seems to me that the stimuli being pushed right now and those recently passed are using the recession as an excuse to grow government  As they say, never let a crisis go to waste.

Lucian Bebchuk on the Fall of the Toxic Assets Plan

Harvard professor Lucian Bebchuk in the WSJ today:  The Fall of the Toxic Assets Plan. Money quote:  "In the meantime, it must be recognized that the curtailing of the PIPP program doesn’t imply that the toxic assets problem has largely gone away; it has been merely swept under the carpet."

Feature on SCSU's Banaian and MacDonald

Fellow economist and MnSCU economists King Banaian (every other letter's an A) and Rich MacDonald's work on the St. Cloud Area Quarterly Business Report is detailed here.

Prices and Waiting Times - Alternative Rationing Systems

Prices are one way to ration scarce goods.  If the price system is not allowed to ration goods, some substitute system will take its place.  One of those substitutes is waiting times.

A couple of interesting facts:

Average US emergency room wait time:  4.05 hours

Average Canada emergency room wait time:  8.9 to 23 hours

I confess the numbers are not apples-apples, but they are certainly in the ballpark and highly illustrative.   Have any commenters seen a direct comparison?

Update: OK, the numbers are more apples-apples than I thought.  The US 4 hour number is total time from coming in the door to leaving or getting a bed, the same as the Canadian numbers.  The CNN report linked above got their data from here.

Under the waiting time rationing system, those who get the goods are those most willing and able to wait.  Under the price system, those most willing and able to pay the price get the good.  It is not at all clear to me that the waiting time system is ethically superior to the price system.

Dude, Where's My Job? A Quarter of the Teenage Labor Force is Unemployed

From the NY Times.

Numbers provide the backdrop to the story — not just the grimly familiar national unemployment rate, 9.5 percent in June, but the even scarier, less publicized unemployment figure for 16- to 19-year-olds, which has hit 24 percent, up from 16.1 percent two years ago. Internships available to college students have fallen 21 percent since last year, according to the National Association of Colleges and Employers. Across the country, there are countless tales like that of Morgan Henderson, a student at the University of San Francisco, who, along with friends, planned a big road trip to Las Vegas this summer. With so few of the friends finding jobs, they downgraded plans to a road trip to Reno, then to no road trip at all. They’re spending time watching DVDs at one another’s houses.

HT Instapundit.  Yes, the business cycle matters.  But don't forget that the national minimum wage, the price floor set on the wages of the lowest skilled of the low-skilled labor force, has increased in July the last two years and is set to increase again this month.