Arnold Kling  

Tyler Cowen's Tight Constraints

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Tyler Cowen suggests four problems for policy research to solve. In several cases, his constraints on the solution are significant. For example, he wants to see


A good health care plan that is practical, not too far from politically feasible, and applies competion to lower costs and improve service quality. It must be incentive-compatible, yet at the same time it can't be seen as heartless and simply letting people die.

I am working on a monograph on health care policy, for one of the infamous think tanks. I am coming around to the view that there is no health care plan that is politically feasible. The American people believe that they have a God-given right to as many health care services as they want, paid for by someone else. As an economist, the best I can do is point out how this belief stymies health care pollicy. But in the absence of cultural change, Tyler's constraint binds too tightly.

Or consider another one of Tyler's challenges.


How can Africa actually develop? Don't beg the question by listing the needed outputs -- such as markets, democracy, or the rule of law -- as the inputs of your policy recommendation.

This begs the question of who is to be the recipient of the "policy recommendation." Are we to assume that we are advising Robert Mugabe? Or are we advising the American State Department on how to influence policy in Zimbabwe? In either case, the constrained optimization problem is almost insoluble.

The thrust of Tyler's constraints seems to be that economists need to offer ideas that are practical and implementable under current political conditions. That is one model, but perhaps not the only way to view policy development. Another role that we can play is to try to educate people so that political conditions do not impose such tight constraints.



COMMENTS (6 to date)
Mr. Econotarian writes:

You probably would be interested in an article in the most recent Harvard Business Review titled "Fixing Health Care from the Inside, Today" which describes how doctors, nurses, technicians, and managers are radically increasing the effectiveness of patient care and dramatically lowering its cost by applying the same capabilities in operations design and improvement that drive the famous Toyota Production System.

Of course the big question is why has it taken so long for continuous operational improvement to come to the world of health care? Is it because there is a lack of business incentives is the US medical system? And are those due to 50% of medical dollars coming from the government, fear of pointing out errors due to insane tort system, or tax incentives for employer-provided medical insurance?

With regards to Africa, we first need to teach economics to people in the US and Africa so they recognize that economic freedom drives economic growth. Then we need a private organization to pick off the African leaders that refuse to budge...

David Thomson writes:

I’ll make it real simply for everybody. Do you really want to see more realistic policies concerning health care costs? If so, vote only for the Republicans. The Democrats are total idiots on the issue and the Republicans are often fearful. The latter need to increase their numbers in the US Congress and the Senate. This will make them more willing to take risks. Most of the time when somebody vote for Democrat candidates---they prove their lack of seriousness concerning economic reforms of any sort.

PS: No, Karl Rove is not paying me. But I won’t mind if he sends me a check in the mail!

JoeO writes:

What about single payer health care like every other first world country?

Jody writes:

Is anyone else amused by "begs the question" being used back to back with two different meanings?

Tyler's use is in accordance with the more traditional logical fallacy meaning (assuming that which you are to prove), while Arnold's is the more recently adopted meaning (prompting the question).

David T. Beito writes:

Joe:

The problem is that many of these "first world" single-payer (e.g. government monopoly) systems give third world treatment to patients waiting for bypass surgery and and other operations. The long cues remain one of the great scandals of the Canadian sytem. See here for details:

http://www.catoinstitute.org/dailys/09-08-04.html

Chris Bolts writes:

As long as people think that health care is a moral obligation and not an optional procedure like any other good, then no reform to health care policy outside of expanded healthcare coverage will ever be feasible to the American public. But, good luck with your analysis, Professor Kling.

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