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October 2012 posts

The Rationality of Voting

Jonathan B. Wight

Many minds have been at work trying to convince young people not to vote—it's a waste of time according to the economic logic of rational expectations.

The Economist ("Is it Irrational to Vote?") effectively rebuts much of this twaddle.

It's not irrational to vote when the stakes are high and the election is close, as this one surely is in many swing states.

Moreover, Kantian rationality asks us to act in ways that can be universalized. If everyone abstains from voting no one can be elected; democracy devolves into something else.

A colleague of mine adds a further idea: If you don't vote, you have no right to complain about anything later.

Finally, there is a virtue ethics notion that we are part of a community. Fulfilling our obligation to vote may take time and some expense, and true, some people free-ride. But that doesn't excuse me from acting in a way that supports a commitment to our joint democracy, which voting certainly is.

There are nuances I don't have time to address, including the argument that most people aren't well educated enough on the issues to cast a sensible ballot. Going down that road will I think lead to some sort of poll tax (in the form of a test before you can vote…. and who will make up the questions and grade the answers?).

And by the way: Which party has more to gain by disenfranchising voters by encouraging apathy?

As positive economics, the rational expectations model fails to predict how humans typically behave in Prisoner Dilemma and Ultimatum Games. The model omits important ideas about trust based on character, commitment, and moral sentiments that are important in the operation of markets and society. The idea that the same flawed model should now tell us how to behave normatively in voting is highly dubious.

Vote! And vote often.

Grass Isn’t Greener

Jonathan B. Wight

James Bacon has a wonderful article on why we should hate grass ("The Grass Isn't Always Greener").

I've hated grass ever since we returned to the U.S. from Brazil when I was sixteen, and I was suddenly given the job of mowing—with a Sears push reel manual mower. It was pure drudgery, especially when the grass got long, which was often.

Once I bought my first house I bought a gas mower (what a relief). But mowing was still boring, so for fun I began to mow in patterns, and would let the grass in the center grow tall and luxuriant. My neighbor complained (probably correctly) that I would be attracting snakes to this lush area of wilderness. Still it appealed to me on deep level to see a bit of untrimmed nature.

But Bacon has a much stronger reason to rip up turf—the environment. Grass is biologically monocultural, supporting little animal life of birds or bees. Moreover, grass requires fertilizers and other chemicals that get into and destroy the Chesapeake Bay. It requires gas to run the mower and causes noxious noise externalities.

De-lawn and bring back life to your garden with trees, flower beds, and vegetable gardens. Get with the program!

History and Humility

Jonathan B. Wight

Brad deLong:

We are not newly created, innocent, rational, and reasonable beings. We are not created fresh in an unmarked Eden under a new sun. We are, instead, the products of hundreds of millions of years of myopic evolution, and thousands of years of unwritten and then recorded history. Our past has built up layer upon layer of instincts, propensities, habits of thought, patterns of interaction, and material resources.

On top of this historical foundation, we build our civilization. Were it not for our history, our labor would not just be in vain; it would be impossible.

Howard Davies:

Can nothing be done to make [economists] more useful in explaining the world as it is, rather than as it is assumed to be in their stylized models?....

For example, there should be more teaching of economic history. We all have good reason to be grateful that US Federal Reserve Chairman Ben Bernanke is an expert on the Great Depression and the authorities' flawed policy responses then, rather than in the finer points of dynamic stochastic general equilibrium theory. As a result, he was ready to adopt unconventional measures when the crisis erupted, and was persuasive in influencing his colleagues.

Many conference participants agreed that the study of economics should be set in a broader political context, with greater emphasis on the role of institutions. Students should also be taught some humility.

Doing positive economics requires basic virtues plus a commitment to put the duty to science ahead of consequential goals. It requires ethical pluralism.

Chinese Corruption Allegations

Jonathan B. Wight

The Chinese government has blocked access to the New York Times and other news sources after an investigative report was released yesterday alleging that the Chinese prime minister's family become billionaires after he rose to power. See: "Billions in Hidden Riches for Family of Chinese Leader"

"Rent-seeking" is unearned income through manipulations of the market and government. The article states that "As prime minister in an economy that remains heavily state-driven, Mr. Wen, who is best known for his simple ways and common touch, more importantly has broad authority over the major industries where his relatives have made their fortunes. Chinese companies cannot list their shares on a stock exchange without approval from agencies overseen by Mr. Wen, for example. He also has the power to influence investments in strategic sectors like energy and telecommunications."

The report details numerous shady dealings in which relatives were given special treatment. The report notes: "Some Chinese argue that permitting the families of Communist Party leaders to profit from the country's long economic boom has been important to ensuring elite support for market-oriented reforms."


China Currency Manipulations

Jonathan B. Wight

Paul Krugman has an interesting perspective on an issue that may come up in tonight's presidential debate: U.S.-China trade relations, and the charge that the Chinese currency provides unfair advantage to its exporters.

Krugman argues that the renminbi has appreciated substantially over the past 5 years and that China's huge current account surplus has nearly disappeared. That suggests the currency is no longer substantially over-valued, especially considering domestic inflation in China.

However, politics does not run on facts but on perceptions. So it will be interesting to see how this plays out tonight.

Special issue of Health Economics, Policy and Law on end-of-life care

Mark D. White

HEPLThe latest issue of Health Economics, Policy and Law (7/4, October 2012) is a special issue on th topic of end-of-life care, stemming from a workshop held by the London School of Economics/Columbia Health Policy Group in December 2010:

Introduction (Adam Oliver)

Comparing the United States and United Kingdom: contrasts and correspondences (Rudolf Klein)

The conventionally antithetical stereotypes of the United Kingdom and United States health care systems needs to be modified in the case of the elderly. Relative to the rest of the population, the over-65s in the United States are more satisfied with their medical care than their UK counterparts. There is also much common ground: shared worries about the quality of elderly care and similar attitudes towards assisted death. Comparison is further complicated by within country variations: comparative studies should take account of the fact that even seemingly polar models may have pools of similarity.

Evidence and values: paying for end-of-life drugs in the British NHS (Kalipso Chalkidou)

In January 2009, Britain's National Institute for Health and Clinical Excellence (NICE), following a very public debate triggered by its decision, six months earlier, provisionally to rule against the adoption by the National Health Service (NHS) of an expensive drug for advanced renal cancer, introduced a new policy for evaluating pharmaceuticals for patients nearing the end of their lives. NICE's so-called end-of-life (EOL) guidance for its Committees effectively advises them to deviate from the Institute's threshold range and to value the lives of (mostly) dying cancer patients more than the lives of those suffering from other, potentially curable, chronic or acute conditions. This article tells the story of the EOL guidance. Through looking at specific EOL decisions between 2009 and 2011 and the reactions by stakeholders to these decisions and the policy itself, it discusses the triggers for NICE's EOL guidance, the challenges NICE faces in implementing it and the policy's putative implications for the future role of NICE in the NHS, especially in the context of value-based reforms in the pricing and evaluation of pharmaceuticals, currently under consideration.

Valuing end-of-life care in the United States: the case of new cancer drugs (Corinna Sorenson)

New cancer therapies offer the hope of improved diagnosis to patients with life-threatening disease. Over the past 5–10 years, a number of specialty drugs have entered clinical practice to provide better systemic therapy for advanced cancers that respond to few therapeutic alternatives. To date, however, such advances have been only modestly effective in extending life and come with a high price tag, raising questions about their value for money, patient access and implications for health care costs. This article explores some of the key issues present in valuing end-of-life care in the United States in the case of advanced cancer drugs, from the difficult trade-offs between their limited health benefits and high costs to the technical, political and social challenges in assessing their value and applying such evidence to inform policy and practice. A number of initial steps are discussed that could be pursued to improve the value of advanced cancer care.

Setting priorities in and for end-of-life care: challenges in the application of economic evaluation (Charles Normand)

Health technology assessment processes aim to provide evidence on the effectiveness and cost-effectiveness of different elements of health care to assist setting priorities. There is a risk that services that are difficult to evaluate, and for which there is limited evidence on cost-effectiveness, may lose out in the competition for resources to those with better evidence. It is argued here that end-of-life care provides particular challenges for evaluation. Outcomes are difficult to measure, can take place over short time scales, and services can be difficult to characterise as they are tailored to the specific needs of individuals. Tools commonly used to measure health care outcomes do not appear to discriminate well in the end-of-life care context. It is argued that the assumption that units of time of different quality of life can simply be added to assess the overall experience at the end of life may not apply, and that alternative perspectives, such as the Peak and End Rule, might offer useful perspectives.

Delivering better end-of-life care in England: barriers to access for patients with a non-cancer diagnosis (Rachael Addicott)

The End of Life Care Strategy (Department of Health, 2008) radically raised the profile of end-of-life care in England, signalling the need for development in planning and delivery, to ensure that individuals are able to exercise genuine choice in how and where they are cared for and die. Research has indicated that there have been continuing difficulties in access to high-quality and appropriate support at the end of life, particularly for patients with a diagnosis other than cancer. This article uses research findings from three case studies of end-of-life care delivery in England to highlight some of the barriers that continue to exist, and understand these challenges in more depth. Access to high-quality and appropriate end-of-life care has been a challenge for all patients nearing the end of life. However, the findings from this research indicate that there are several interrelated reasons why access to end-of-life care services can be more difficult for patients with a non-cancer diagnosis. These issues relate to differences in disease trajectories and subsequent care planning, which are further entrenched by existing funding arrangements.

US health care: the unwinnable war against death (Daniel Callahan)

For well over 40 years, the United States has struggled to improve end-of-life care. This effort, heavily focused on living wills, hospice and improved doctor–patient communications and palliative care, has been a modest success only. Both doctors and patients are often unwilling to accept the fact that death is on the way – only 25% of Americans have an advance directive. Advances in medical technology have provided more ways of keeping dying patients alive, making the line between living and dying harder to discern. The way physicians are paid promotes the use of technology not for talking with patients. Underlying these practical problems is a culture of American medicine with deep historical roots: that medical progress should be unending and is a moral imperative, that death is the greatest enemy and that cure, not care, is the primary goal. A better balance between care and cure is needed.

Stealing on insensibly: end of life politics in the United States (Lawrence D. Brown)

Because the United States often seems (and seems eager to present itself as) the home of the technological imperative and of determination to brand all challenges to it in end-of-life care as a descent into death panels, the prospects look unpromising for progress in US public policies that would expand the range of choices of medical treatments available to individuals preparing for death. Beneath this obdurate and intermittently hysterical surface, however, the diffusion across US states and communities of living wills, advanced directives, palliative care, hospice services and debates about assisted suicide is gradually strengthening not so much ‘personal autonomy’ as the authority, cultural and formal, of individuals and their loved ones not merely to shape but to lead the inevitably ‘social’ conversations on which decisions about care at the end of life depend. In short, the nation appears to be (in terms taken from John Donne's mediations on death) ‘stealing on insensibly’ – making incremental progress toward the replacement of clinical and other types of dogma with end-of-life options that honor the preferences of the dying.

End-of-life care for patients with dementia in the United States: institutional realities (Michael Gusmano)

Few are satisfied with end-of-life care in the United States. For families and friends of people with dementia, end-of-life care is particularly frustrating. Providing better end-of-life care to people with dementia is urgent because the prevalence of the disease is increasing rapidly. Dementia is currently the seventh leading cause of death in the United States and fifth leading cause of death among people aged 65 years and older. By 2050, there will be around 19 million people with Alzheimer's disease. This article reviews ethical and policy challenges associated with providing end-of-life care for people with dementia in the United States. I explain how disagreements about the meaning of futility lead to poor care for people with dementia. Most people agree that we should not provide care that is futile, but there is little agreement about how futility should be defined. US policies and politics clearly tip the balance in the direction of treatment, even in the face of strong evidence that such care does more harm than good. Although we may never reach a consensus, it is important to address these questions and think about how to develop policies that respect the different values.

Dementia, death and advance directives (Jonathan Wolff)

This article considers the ethics of advance directives, especially in relation to conditions such as dementia. For some choices, such as over whether one's life should end at home or in a hospice, advance directives can be very enlightened and helpful. For others, such as those to end the life of an autonomous subject, against their will, have no moral appeal and would rightly be ignored. In a wide range of intermediate cases, given our typical lack of insight into how changes in our health condition will affect us in other ways, we should be very cautious indeed in promoting the use of advance directives in end-of-life decisions, at least where a reasonable quality of life remains. There may be some reasons for giving priority to the earlier autonomous self over a later, contented but non-autonomous self, but these reasons seem far from compelling.

Foxconn Revealed

Jonathan B. Wight

China undoubtedly still has some evil sweatshop factories abusing rural young women.

But Foxconn likely is not one of them. Foxconn, you will remember, is the Taiwanese company that makes the iPhone and other electronics in Chinese factories. Numerous allegations have been made about unsafe working conditions and labor rights violations.

James Fallows went on an impromptu visit to the Chinese operation. He notes:

"Some 220,000 people work there; about a quarter of them live on site; and several thousand new employees are recruited, trained, and brought onto staff each week, because turnover at Foxconn and many of these Chinese manufacturing centers is so high. Foxconn has been controversial over the years because of allegations of sweatshop operation and of militaristic surveillance and discipline, plus a wave of worker suicides in 2010."

While one of the buildings does have suicide nets (see below, just above the blue trucks), Fallows' reporting notes how normal the whole operation seems. People coming and going; the dorms rooms are small and crowded but clean; workers crowd into the electronic café on breaks to surf the web.

Fallows admits this is not an official inspection and more posts will come:

"I am not yet going to characterize what I saw, and I am not pretending to know more than I do. This was a few hours out of one day. But what I saw once inside the gate was very different from the picture that "Foxconn" had always conjured up in my mind."

Symposium on Obamacare in The Journal of Law, Medicine & Ethics

Mark D. White

JLMEThe latest issue of The Journal of Law, Medicine & Ethics (40/3, Fall 2012) features a symposium titled "The Health Care Reform Law (PPACA): Controversies in Ethics and Policy," based on a conference held at the Medical University of South Carolina in October 2011 and organized as a group of point-counterpoint discussions focusing on "the responsibilities of individuals versus those of society to provide health care, the morality of market-based health care reforms, the effectiveness of consumer-driven health care reforms, and the role of the principle of justice in grounding health care reform" ("Introduction," p. 523).

Introduction (Robert M. Sade)

Physicians Have a Responsibility to Meet the Health Care Needs of Society (Allan S. Brett)

Medical Responsibility (Ronald Hamowy)

Market-Based Reforms in Health Care Are Both Practical and Morally Sound (James Stacey Taylor)

Government Intervention in Health Care Markets Is Practical, Necessary, and Morally Sound (Len M. Nichols)

Expanding Choice through Defined Contributions: Overcoming a Non-Participatory Health Care Economy (Robert E. Moffit)

Cost-Sharing under Consumer-Driven Health Care Will Not Reform U.S. Health Care (John P. Geyman)

Justice and Fairness: A Critical Element in U.S. Health System Reform (Paul T. Menzel)

No Theory of Justice Can Ground Health Care Reform (Griffin Trotter)

Call for papers: Economics-and-ethics at the 2013 Eastern Economic Association meetings

Mark D. White

[This is a repost of the call for papers for the Association for Social Ecnomics sessions at next spring's Eastern Economic Association meetings, emphasizing that papers on economics-and-ethics are particularly welcome.]

* * *

Submissions are now open for the Association for Social Economics sessions at the 2013 Eastern Economic Association meetings, being held in New York City from May 9-11, 2013. (Note the date: EEA meetings are normally in late February or early March, but had to be scheduled later for 2013.) Please visit the link above for more details regarding the meetings.

Individual papers (as well as organized sessions) on any topic related to social economics are welcome. As usual, proposals dealing with economics and ethics are particularly encouraged. All whose proposals are accepted must register for the conference but do not have to pay the paper submission fee.

Please email Professor Mark D. White ([email protected]) with your proposal (or any questions about the meetings) by November 15.

Killing the Messenger—Killing Science

Jonathan B. Wight

Today's good news that the unemployment rate fell to 7.8% has spawned a barrage of outrage by Republicans who claim the figures were rigged:

Former GE CEO Jack Welch, wrote: "Unbelievable jobs numbers…these Chicago guys will do anything...can't debate so change numbers."

Other pundits have cast aspersions on the career economists at the Department of Labor who compiled the numbers.

The attack on civil servants whose careers depend on impartially collecting and reporting data is deeply disturbing because it politicizes what should be professional.

I am not a stranger to government workers rigging data. When I grew up in Brazil the government was constantly lying about inflation so as try to impact labor and financial contracts. Citizens became cynical of any information coming out of government, and rightly so.

Fortunately, in the United States, we have a fairly long history of establishing civil servant agencies that are staffed by people with professional ethics.

There are exceptions. I remember the 1972 election when it seemed Arthur Burns at the Fed was intent on re-electing President Nixon and made sure to fix monetary policy for that effect. George W. Bush packed the occupying development agency in Iraq with Republican Party operatives who knew little about development.

Charging "Fire!" in a theater when there is no smoke is an offense. Charging "Fabrication!" on the unemployment data when there isn't a shred of evidence ought to provoke outrage against the perpetrators.