A good question to ask those economists would be: do you have a private health insurance? I am sure they do, especially in Europe. The ones that don't i am sure they can afford skipping the public Healthcare lines.
I think economists should focus on how a society promotes Health in the most cost-effective manner. Socialized medicine is only one of hundreds of means to do so, and the evidence is not very compelling in its cost-effectiveness compared to other strategies.
Medical coverage is supposed to be a means to an end, not an end unto itself. Health should be the goal.
"I think economists should focus on how a society promotes Health in the most cost-effective manner" Why is it "society" (whatever that is) promotes health..." Why not individuals promote .....
As to health as the goal, at what cost? in econ 1, first thing you learn about is the production possibility curve--tradeoffs! More resources towards health, few resources toward other goods (housing, food, etc)
I'd think economists, just like humans, have moral intuitions and ideologies, so many of them see health care as a right rather than a market commodity, which allows for the cognitive dissonance you are describing.
You never hear people talk about "moral hazard," "negative selection" or "information assymetries" guaranteeing market failures in the life insurance or annuities businesses, yet they are equally prone to these problems.
Many (but not all!) economists long ago recognized that "market failure" does not entail government intervention. "Government failure" is just as likely, if not more so with potentially even great inefficiencies, than "market failure". The Public Choice literature has dealt with this topic for many years now. The literature is vast.
Also, I suggest people read up on Harold Demsetz's "The Nirvana Fallacy". To quote from T. Hazlett "Demsetz dubbed Arrow’s approach the “Nirvana Fallacy,” asserting that it relied on “perfection by incantation” and “invok[ed] an unexamined alternative.” This, argued Demsetz, illustrated “common fallacies in the normative use of efficiency, stressing important and often implausible hidden assumptions . . . . For example, to reach some normative conclusions it is necessary to assume that people will respond to incentives differently from the way they are responding." (George Mason Law Review, 2021)
I hear this argument in the annuity market all the time, as an explanation of why annuities aren't more popular. I hear (and make) this argument even more often for the pet insurance market. These market failures just aren't seen as being tremendously costly to society.
I'd also note that "market failure" isn't an absolute. We have markets for used cars despite the market for lemons problem, and we have markets for pet insurance and annuities. The markets are just smaller than they would be absent market failures.
The argument from economists - going back to Kenneth Arrow's orginal article - is that healthcare is inherently prone to market failure. The demands from economists for government intervention into/provision of health insurance - not the general public, but economists (which is what Bryan Caplan is referring to) - comes from this argument. My point is that we see real, live, functioning markets in things like life insurance and annuities which prove that these are not insurmountable problems which inevitably lead to market failure and an economically justified demand for government control/provision.
Insurance companies do not typically raise the premium on a life insurance policy after the subject dies. Health insurance barely qualifies as insurance in the first place, and not at all after regulations began requiring coverage of pre-existing conditions. The idea was that the future is uncertain, and people can adjust their risk exposure by combining their risks into something more predictable. Now “insurance” is just a way to spread out the payments.
I don't know if you can just give money to poor people, you have to think about the effective tax rate. Either you have the political power to implement a negative income tax and cut every other public program or I don't think you can solve this problem by itself
I find myself, like Hayek, not allergic to a government role in healthcare. At the end of the day it mixes insurance and caring for others in ways that are difficult for human intuition to separate. That issue will not go away, we are going to pay for uninsured people who show up at the emergency room. We just are. So the question is what's the best system to deal with this. Our current system sucks, but really we could just stop doing a bunch of stupid things. A public long wait system, and private skip the line system is not a bad compromise. Then we can have prizes for things that reduce the cost of the public system. Since we internalize those costs.
I think it will be easier to say, you can't have hurricane insurance if you choose to live in Florida then it will be to say grandma has to die because she can't afford insulin. In a rich country healthcare will be somewhat of a government issue. All we can do is make it cheaper and set a low standard of free care.
"I think it will be easier to say, you can't have hurricane insurance if you choose to live in Florida then it will be to say grandma has to die because she can't afford insulin". this does not entail government intervention in health care. The grandma part might entail income supplementary programs so that grandma can afford it, but that is not the same as direct intervention in health care markets. Or it might entail "health care vouchers" but not directly intervening in health care markets. Those are different kinds of interventions with very different efficiency implications. Read up on economics...if you want an analogy, think of housing--rent control with all of its attendant problems vs some sort of income supplement.
A good question to ask those economists would be: do you have a private health insurance? I am sure they do, especially in Europe. The ones that don't i am sure they can afford skipping the public Healthcare lines.
I think economists should focus on how a society promotes Health in the most cost-effective manner. Socialized medicine is only one of hundreds of means to do so, and the evidence is not very compelling in its cost-effectiveness compared to other strategies.
Medical coverage is supposed to be a means to an end, not an end unto itself. Health should be the goal.
"I think economists should focus on how a society promotes Health in the most cost-effective manner" Why is it "society" (whatever that is) promotes health..." Why not individuals promote .....
As to health as the goal, at what cost? in econ 1, first thing you learn about is the production possibility curve--tradeoffs! More resources towards health, few resources toward other goods (housing, food, etc)
I agree.
Trade-offs are very important to the concept of "cost-effective."
I'd think economists, just like humans, have moral intuitions and ideologies, so many of them see health care as a right rather than a market commodity, which allows for the cognitive dissonance you are describing.
The photo suggests another possible message here.
You never hear people talk about "moral hazard," "negative selection" or "information assymetries" guaranteeing market failures in the life insurance or annuities businesses, yet they are equally prone to these problems.
Many (but not all!) economists long ago recognized that "market failure" does not entail government intervention. "Government failure" is just as likely, if not more so with potentially even great inefficiencies, than "market failure". The Public Choice literature has dealt with this topic for many years now. The literature is vast.
Also, I suggest people read up on Harold Demsetz's "The Nirvana Fallacy". To quote from T. Hazlett "Demsetz dubbed Arrow’s approach the “Nirvana Fallacy,” asserting that it relied on “perfection by incantation” and “invok[ed] an unexamined alternative.” This, argued Demsetz, illustrated “common fallacies in the normative use of efficiency, stressing important and often implausible hidden assumptions . . . . For example, to reach some normative conclusions it is necessary to assume that people will respond to incentives differently from the way they are responding." (George Mason Law Review, 2021)
I hear this argument in the annuity market all the time, as an explanation of why annuities aren't more popular. I hear (and make) this argument even more often for the pet insurance market. These market failures just aren't seen as being tremendously costly to society.
I'd also note that "market failure" isn't an absolute. We have markets for used cars despite the market for lemons problem, and we have markets for pet insurance and annuities. The markets are just smaller than they would be absent market failures.
It's a fair point (particularly the point about failure not being "absolute").
Of course, the statement that the markets are smaller than they otherwise would be in the absence of a (partial) market failure is unprovable.
One difference is that no one demands universal life insurance/annuities, so insurance companies are free to deny customers who seem too risky.
That's not my point.
The argument from economists - going back to Kenneth Arrow's orginal article - is that healthcare is inherently prone to market failure. The demands from economists for government intervention into/provision of health insurance - not the general public, but economists (which is what Bryan Caplan is referring to) - comes from this argument. My point is that we see real, live, functioning markets in things like life insurance and annuities which prove that these are not insurmountable problems which inevitably lead to market failure and an economically justified demand for government control/provision.
Insurance companies do not typically raise the premium on a life insurance policy after the subject dies. Health insurance barely qualifies as insurance in the first place, and not at all after regulations began requiring coverage of pre-existing conditions. The idea was that the future is uncertain, and people can adjust their risk exposure by combining their risks into something more predictable. Now “insurance” is just a way to spread out the payments.
I don't know if you can just give money to poor people, you have to think about the effective tax rate. Either you have the political power to implement a negative income tax and cut every other public program or I don't think you can solve this problem by itself
I find myself, like Hayek, not allergic to a government role in healthcare. At the end of the day it mixes insurance and caring for others in ways that are difficult for human intuition to separate. That issue will not go away, we are going to pay for uninsured people who show up at the emergency room. We just are. So the question is what's the best system to deal with this. Our current system sucks, but really we could just stop doing a bunch of stupid things. A public long wait system, and private skip the line system is not a bad compromise. Then we can have prizes for things that reduce the cost of the public system. Since we internalize those costs.
I think it will be easier to say, you can't have hurricane insurance if you choose to live in Florida then it will be to say grandma has to die because she can't afford insulin. In a rich country healthcare will be somewhat of a government issue. All we can do is make it cheaper and set a low standard of free care.
"I think it will be easier to say, you can't have hurricane insurance if you choose to live in Florida then it will be to say grandma has to die because she can't afford insulin". this does not entail government intervention in health care. The grandma part might entail income supplementary programs so that grandma can afford it, but that is not the same as direct intervention in health care markets. Or it might entail "health care vouchers" but not directly intervening in health care markets. Those are different kinds of interventions with very different efficiency implications. Read up on economics...if you want an analogy, think of housing--rent control with all of its attendant problems vs some sort of income supplement.