The Concentration and Persistence of Health Care Spending | Tom Miller

December 17, 2017

It turns out that health care spending, at least in the underage-65 private markets for health insurance, has become less, not more, concentrated in recent decades. After a significant decline in spending concentration about two decades ago, it has stabilized
at that lower level. There is a significant decline in concentrated spending among individuals from one year to the next. That decline in the “persistence” of high spending continues in people’s later years, though at a less significant rate.

Nevertheless, the overall pattern remains that a majority of individuals below Medicare age, or people not redirected to other forms of public insurance coverage (primarily Medicaid) as a result of longer-term disabling and income-limiting health conditions, just don’t need to spend that much of their income on health care. Whether they still should be required to pay much more for their insurance under the ACA or some other government intervention is largely a matter of policymakers’ choice rather than economic necessity.

via https://object.cato.org/sites/cato.org/files/serials/files/regulation/2017/12/regulation-v40n4-4.pdf


The Impact of Federal Regulation on the 50 States

December 17, 2017

The federal regulation and state enterprise (FRASE) index ranks the 50 states and the District of Columbia according to the impact of federal regulation on the private-sector industries in each state’s economy. A ranking of 1 indicates the highest level of impact of federal regulation on a state’s economy, whereas a ranking of 51 means the lowest.

For several decades, the federal government has relied on regulations as the primary vehicle to intervene in economic activity across the United States. The continual buildup of regulations in the Code of Federal Regulations, shown in the figure below, is known as regulatory accumulation. The FRASE index is designed to quantify the effects of regulatory accumulation at the state level.

via The FRASE Index – QuantGov


Wealthier, Happier and More Self-Sufficient: When Anti-Poverty Programs Improve Economic and Subjective Wellbeing at a Reduced Cost to Taxpayers

December 17, 2017

We document how an anti-poverty program improves economic and subjective wellbeing, and self-sufficiency. Familias en Accion Urbano, a conditional cash transfer program implemented at scale in the country of Colombia, uses a means-test cutoff score selection rule that provides exogenous variation in program participation. We reproduce the score assignment rule in a nationally representative living standards household survey that measures multiple dimensions of economic and evaluative wellbeing. Three years into the program, beneficiary households at the margin report greater income, consumption and formal employment participation for both the household head and partner. Household income increased by ten times the amount of the government transfer, likely because of gains in formal employment. Beneficiary households at the margin also report greater overall satisfaction with life, greater happiness and greater satisfaction with food. These results support the hypothesis that among households with basic unmet needs, policies that have a permanent impact on income and consumption may also have a lasting impact on subjective wellbeing and self-sufficiency. Moreover, relatively small subsidies, further offset by additional government tax receipt, may generate substantial benefits to poor families at a reduced cost to taxpayers.

via Wealthier, Happier and More Self-Sufficient: When Anti-Poverty Programs Improve Economic and Subjective Wellbeing at a Reduced Cost to Taxpayers by Titus Galama, Robson Morgan, Juan Saavedra :: SSRN


Happiness for All? Unequal Hopes and Lives in Pursuit of the American Dream

December 17, 2017

The Declaration of Independence states that all people are endowed with certain unalienable rights, and that among these is the pursuit of happiness. But is happiness available equally to everyone in America today? How about elsewhere in the world? Carol Graham draws on cutting-edge research linking income inequality with well-being to show how the widening prosperity gap has led to rising inequality in people’s beliefs, hopes, and aspirations.

For the United States and other developed countries, the high costs of being poor are most evident not in material deprivation but rather in stress, insecurity, and lack of hope. The result is an optimism gap between rich and poor that, if left unchecked, could lead to an increasingly divided society. Graham reveals how people who do not believe in their own futures are unlikely to invest in them, and how the consequences can range from job instability and poor education to greater mortality rates, failed marriages, and higher rates of incarceration. She describes how the optimism gap is reflected in the very words people use—the wealthy use words that reflect knowledge acquisition and healthy behaviors, while the words of the poor reflect desperation, short-term outlooks, and patchwork solutions. She also explains why the least optimistic people in America are poor whites, not poor blacks or Hispanics.

Happiness for All? highlights the importance of well-being measures in identifying and monitoring trends in life satisfaction and optimism—and misery and despair—and demonstrates how hope and happiness can lead to improved economic outcomes.

via Graham, C.: Happiness for All?: Unequal Hopes and Lives in Pursuit of the American Dream (Hardcover and eBook) | Princeton University Press


New Evidence on the Causal Impact of Traffic Safety Laws on Drunk Driving and Traffic Fatalities

December 17, 2017

In the United States, about 28 lives are lost daily in motor vehicle accidents that involve an alcohol-impaired driver. The conventional wisdom is that these accidents can be prevented through the use of strict traffic laws that are robustly enforced, though no consensus exists on the causal impact of these laws in reducing motor vehicle-related fatalities. This paper exploits quasi-random variation in state-level driving and road safety restrictions to estimate the causal effect of select traffic laws on the number of fatal accidents and fatal accidents involving a drunk driver. In this paper, we employ the contiguous-border county-pair approach. This is causally identified from the discontinuities in policy treatments among homogeneous contiguous counties that are separated by a shared state border. This approach addresses the econometric issues created due to spatial heterogeneity that may have biased several studies in the literature. The analysis reveals that the laws related to accident prevention, such as having a good graduated licensing system, Pigovian beer taxes, and primary seatbelt enforcement, are the most effective in reducing motor vehicle-related fatalities. Using these estimated coefficients, simple simulations suggest that policymakers have been utilizing existing traffic laws sub-optimally, saving only 17% of the lives lost to motor vehicle crashes.

via New Evidence on the Causal Impact of Traffic Safety Laws on Drunk Driving and Traffic Fatalities by Nicholas Wright, La-Troy Lee :: SSRN


Does Marriage Make Us Healthier? Evidence from Middle-Aged and Older Japanese

December 17, 2017

This study investigated health premium of marriage among middle-aged and older Japanese. Using a unique longitudinal micro dataset for Japanese aged 45–80 years in 2007, we applied a dynamic panel data model and utilized both subjective and objective health indicators for 4,386 observations from 2008 to 2012. We found significant marriage–health premium among middle-aged Japanese, while the evidence for older Japanese was inconclusive. This is the first study addressing the endogeneity between marriage and health to confirm the protective effect of marriage on health for middle-aged and older people in Japan, which sounds an alarm for Japanese health policies facing the late marriage and rising divorce rates owing to the receding economy and shifting social norms.

via Does Marriage Make Us Healthier? Evidence from Middle-Aged and Older Japanese by Rong FU, Haruko Noguchi :: SSRN


Test-Retest Reliability of Subjective Survival Expectations

December 17, 2017

This paper analyzes the test-retest reliability of subjective survival expectations. Using a nationally representative sample from the Netherlands, we compare probabilities reported by the same individuals in two different surveys that were fielded in the same month. We evaluate reliability both at the level of reported probabilities and through a model that relates expectations to socio-demographic variables. Test-retest correlations of survival probabilities are between 0.5 and 0.7, which is similar to subjective well-being (Krueger and Schkade, 2008). Only 20% of probabilities are equal across surveys, but up to 61-77% are consistent once we account for rounding. Models that analyze all probabilities jointly reveal similar associations between covariates and the hazard of death in test and retest datasets. Moreover, expectations are persistent at the level of the individual and this unobserved heterogeneity is strongly correlated across surveys (r ≈ 0.8-0.9). Finally, we use a life-cycle model to map survival expectations into simulated wealth and labor supply. Though wealth accumulation is sensitive to survival expectations, simulated probabilities from a model that corrects for rounding are sufficiently reliable to yield reliable wealth profiles. Taken together this evidence supports the reliability of subjective survival expectations.

via Test-Retest Reliability of Subjective Survival Expectations by Jochem Bresser :: SSRN