Economics... (2 Viewers)

Juliano13

Senior Member
May 6, 2012
3,863
Btw @Juliano13, you ran away from this too.

It's what he does I guess, @DAiDEViL

- - - Updated - - -



I didn't see you responding to this post either, @Juliano13

You have NO actual solutions, NO real world experience. That much is obvious to me.
:lol:

It's late, I'll respond to all that drivel tomorrow.
 

Juliano13

Senior Member
May 6, 2012
3,863
@Seven @Fr3sh and anyone else who was interested in the discussion.

Finally, this took almost 3 hours to write while browsing efukt.

I will compare here the US vs EU health system and show that it’s not as simple as “the US spends more on healthcare and has a lower life expectancy, therefore US healthcare is worse.”

While I prefer the US system to the EU system, because it’s more free-market, this is not a comparison between a totally free vs socialist systems. Keep the following in mind:
1. With Obamacare, the USA is moving towards universal health coverage.
2. The government, through Medicare and Medicaid, and through tax-code subsidies, is a major player in the health services market.
3. The EU does not have a common healthcare system. Every country is different. Most people assume that the French system is the most socialist one, but that is not true. In France there are a lot of private hospitals. People pay part of their health expenses out-of-pocket and there are supplemental private health plans. In the UK almost all hospitals are government-run and healthcare is free.
4. It’s best to look at the questions of who should run hospitals and who should provide health insurance separately (and whether there should be universal health coverage).

Social cost vs $$ expenditure
1. The social cost of producing a good, for example an inflatable sex doll, is not the price of the good, but the opportunity cost, meaning how much labour and capital (machines) is needed to produce it. Example: country A needs 3 workers and 1 machine to produce a sex doll, while country B needs 5 workers and 1 machine. But in country A workers get paid $2 per sex doll they produce, while in B they’re paid $1. In both countries the cost of the machine is $2 per sex doll. Then the price of a sex doll in country A is $8 compared to $7 in country B, but country A is still more efficient in producing sex dolls, because the social cost is lower.
2. This is important in the discussion of healthcare because the social cost of healthcare in the USA is lower, or at least not greater than the OECD average (look HERE). USA has fewer doctors per person, fewer doctor visits and fewer days spent in hospital (but they do have more nurses and more medical technology per person).

Why does USA spend more $$ on healthcare than EU?
1. The US has higher income per capita than the EU and the income elasticity of healthcare spending is >1. That means that for a 1% increase in income, healthcare spending goes up by more than 1%. This is not a bad thing. As we get richer, what else should we spend our money on? Do we really need more clothes, a 3rd car, more dildos, strap on cocks and anal beads? HERE Robert Hall and Charles Jones calculate that optimal spending on healthcare is likely to exceed 30% of income by the middle of the century.
2. Doctors are paid more in the US than in Europe.
a. Part of the reason is that in the US there is a larger percentage of private hospitals, while in some EU countries, like the UK, the government is the dominant player. This situation is close to a monopsony, so the income of doctors is suppressed.
b. The other reason is that doctors pay for their own education in America by taking loans, which they have to pay back later. This means that if an American doctor earns $10 and pays $2 back, his net income is $8, while healthcare spending is $2. If a German doctor gets a free education and then earns $8, his net income is the same, total spending is also the same, but the $2 are counted as education spending, instead of healthcare spending.
3. Americans tend to spend a lot more money than Europeans on high-cost low-benefit procedures, particularly expensive life-saving procedures that have a low probability of success. One can argue whether this is good or bad, but for me it’s logical that people who have the opportunity are willing to spend a lot even for a small chance of improvement.
4. Technology. Like I mentioned before, USA uses more technology than the EU. In fact, technology is the one of the main reasons for rising healthcare costs worldwide.

Does the fact that USA spends more on healthcare and Americans have lower life expectancy necessarily mean that USA has worse healthcare than EU?
1. Looking at life expectancy alone is a wrong way to evaluate a healthcare system. There are many factors that affect it that have nothing to do with quality or even availability of healthcare. In this case the main reason for the lower life expectancy in USA is the higher homicide rate and the higher road accident mortality rate. Furthermore, Americans are much more overweight than Europeans and live a less healthy lifestyle in general. They also have a higher rate of low-birth-weight babies, due to the higher rate of teenage pregnancies. Low-birth-weight babies have a much greater mortality rate.
2. The only way to compare quality of healthcare systems is direct results. That means comparing the effectiveness in treating all medical conditions (and preventing through early check-ups). Unfortunately, this is very difficult to calculate. HERE is a study that shows that increased spending is associated with better outcomes in breast cancer treatment. HERE is a study that shows that USA is not only better (lower mortality rate and better survival rate), but is getting good value for money in cancer treatment. HERE is an article that argues in favor of using mortality rate, instead of survival rate and criticizes some of the other studies. An Analysis Of Whether Higher Health Care Spending In The United States Versus Europe Is ‘Worth It’ In The Case Of Cancer, another study criticizing this one HERE , and the response from the authors HERE.

Is there a reason to believe that USA spends more on healthcare than optimal and if so, what is the best way to reduce spending (or to reduce the growth of spending)?
1. USA is almost certainly spending more on healthcare than optimal because they are over-insured. The reason for that is that the tax code subsidizes employer-purchased insurance. It is cheaper for an employer to provide the employee with an insurance worth $X than to pay $X more in cash salary. This explains why in America almost all insurance is provided by the employer.
2. The result is that the typical health insurance is more expensive and provides more coverage than optimal. For example, most health insurances pay for routine visits and regular check-ups. Insurance is necessary for high-cost low probability events but these are low-cost almost-certain events that people can afford to pay for out of pocket. That means that the typical insurance is also a pre-payment plan for health services.
3. The way to cut down costs is to remove the preferential tax treatment for employer-provided health insurance. If people purchase their own insurance or pay out of pocket, they will cut down on unnecessary procedures and visits. Unfortunately, Obamacare has made this problem even worse.

So, what does the evidence show? The USA spends more on healthcare as % of income, but the social cost of healthcare is lower. The main reasons why USA spends more are higher income, more technology, doctors get paid more. In order to evaluate correctly whether Americans are getting their money’s worth, we need to look at the effects of treatment, while controlling for other variables that skew the results. Good studies are rare and complicated to conduct, but there is some evidence that the USA does better when it comes to cancer treatment. Still, Americans most likely spend more money than optimal on health care, due to the tax code.

Should there be universal healthcare?
This is not a simple question of economics, but more of a moral dilemma. To answer this question will take an equally long post, so I’ll do it later, but the answer depends on the following two questions:
1. Should people who can afford a health insurance, but don’t want one be forced to get it?
2. Should a health insurance be provided to those that can’t afford it?
If the answer to question 2 is yes, the next question is what is the best way to achieve that? As we have seen from the examples of USA and Europe, there are several different ways that need to be compared.
 

Fr3sh

Senior Member
Jul 12, 2011
35,412
@Seven @Fr3sh and anyone else who was interested in the discussion.

Finally, this took almost 3 hours to write while browsing efukt.

I will compare here the US vs EU health system and show that it’s not as simple as “the US spends more on healthcare and has a lower life expectancy, therefore US healthcare is worse.”

While I prefer the US system to the EU system, because it’s more free-market, this is not a comparison between a totally free vs socialist systems. Keep the following in mind:
1. With Obamacare, the USA is moving towards universal health coverage.
2. The government, through Medicare and Medicaid, and through tax-code subsidies, is a major player in the health services market.
3. The EU does not have a common healthcare system. Every country is different. Most people assume that the French system is the most socialist one, but that is not true. In France there are a lot of private hospitals. People pay part of their health expenses out-of-pocket and there are supplemental private health plans. In the UK almost all hospitals are government-run and healthcare is free.
4. It’s best to look at the questions of who should run hospitals and who should provide health insurance separately (and whether there should be universal health coverage).

Social cost vs $$ expenditure
1. The social cost of producing a good, for example an inflatable sex doll, is not the price of the good, but the opportunity cost, meaning how much labour and capital (machines) is needed to produce it. Example: country A needs 3 workers and 1 machine to produce a sex doll, while country B needs 5 workers and 1 machine. But in country A workers get paid $2 per sex doll they produce, while in B they’re paid $1. In both countries the cost of the machine is $2 per sex doll. Then the price of a sex doll in country A is $8 compared to $7 in country B, but country A is still more efficient in producing sex dolls, because the social cost is lower.
2. This is important in the discussion of healthcare because the social cost of healthcare in the USA is lower, or at least not greater than the OECD average (look HERE). USA has fewer doctors per person, fewer doctor visits and fewer days spent in hospital (but they do have more nurses and more medical technology per person).

Why does USA spend more $$ on healthcare than EU?
1. The US has higher income per capita than the EU and the income elasticity of healthcare spending is >1. That means that for a 1% increase in income, healthcare spending goes up by more than 1%. This is not a bad thing. As we get richer, what else should we spend our money on? Do we really need more clothes, a 3rd car, more dildos, strap on cocks and anal beads? HERE Robert Hall and Charles Jones calculate that optimal spending on healthcare is likely to exceed 30% of income by the middle of the century.
2. Doctors are paid more in the US than in Europe.
a. Part of the reason is that in the US there is a larger percentage of private hospitals, while in some EU countries, like the UK, the government is the dominant player. This situation is close to a monopsony, so the income of doctors is suppressed.
b. The other reason is that doctors pay for their own education in America by taking loans, which they have to pay back later. This means that if an American doctor earns $10 and pays $2 back, his net income is $8, while healthcare spending is $2. If a German doctor gets a free education and then earns $8, his net income is the same, total spending is also the same, but the $2 are counted as education spending, instead of healthcare spending.
3. Americans tend to spend a lot more money than Europeans on high-cost low-benefit procedures, particularly expensive life-saving procedures that have a low probability of success. One can argue whether this is good or bad, but for me it’s logical that people who have the opportunity are willing to spend a lot even for a small chance of improvement.
4. Technology. Like I mentioned before, USA uses more technology than the EU. In fact, technology is the one of the main reasons for rising healthcare costs worldwide.

Does the fact that USA spends more on healthcare and Americans have lower life expectancy necessarily mean that USA has worse healthcare than EU?
1. Looking at life expectancy alone is a wrong way to evaluate a healthcare system. There are many factors that affect it that have nothing to do with quality or even availability of healthcare. In this case the main reason for the lower life expectancy in USA is the higher homicide rate and the higher road accident mortality rate. Furthermore, Americans are much more overweight than Europeans and live a less healthy lifestyle in general. They also have a higher rate of low-birth-weight babies, due to the higher rate of teenage pregnancies. Low-birth-weight babies have a much greater mortality rate.
2. The only way to compare quality of healthcare systems is direct results. That means comparing the effectiveness in treating all medical conditions (and preventing through early check-ups). Unfortunately, this is very difficult to calculate. HERE is a study that shows that increased spending is associated with better outcomes in breast cancer treatment. HERE is a study that shows that USA is not only better (lower mortality rate and better survival rate), but is getting good value for money in cancer treatment. HERE is an article that argues in favor of using mortality rate, instead of survival rate and criticizes some of the other studies. An Analysis Of Whether Higher Health Care Spending In The United States Versus Europe Is ‘Worth It’ In The Case Of Cancer, another study criticizing this one HERE , and the response from the authors HERE.

Is there a reason to believe that USA spends more on healthcare than optimal and if so, what is the best way to reduce spending (or to reduce the growth of spending)?
1. USA is almost certainly spending more on healthcare than optimal because they are over-insured. The reason for that is that the tax code subsidizes employer-purchased insurance. It is cheaper for an employer to provide the employee with an insurance worth $X than to pay $X more in cash salary. This explains why in America almost all insurance is provided by the employer.
2. The result is that the typical health insurance is more expensive and provides more coverage than optimal. For example, most health insurances pay for routine visits and regular check-ups. Insurance is necessary for high-cost low probability events but these are low-cost almost-certain events that people can afford to pay for out of pocket. That means that the typical insurance is also a pre-payment plan for health services.
3. The way to cut down costs is to remove the preferential tax treatment for employer-provided health insurance. If people purchase their own insurance or pay out of pocket, they will cut down on unnecessary procedures and visits. Unfortunately, Obamacare has made this problem even worse.

So, what does the evidence show? The USA spends more on healthcare as % of income, but the social cost of healthcare is lower. The main reasons why USA spends more are higher income, more technology, doctors get paid more. In order to evaluate correctly whether Americans are getting their money’s worth, we need to look at the effects of treatment, while controlling for other variables that skew the results. Good studies are rare and complicated to conduct, but there is some evidence that the USA does better when it comes to cancer treatment. Still, Americans most likely spend more money than optimal on health care, due to the tax code.

Should there be universal healthcare?
This is not a simple question of economics, but more of a moral dilemma. To answer this question will take an equally long post, so I’ll do it later, but the answer depends on the following two questions:
1. Should people who can afford a health insurance, but don’t want one be forced to get it?
2. Should a health insurance be provided to those that can’t afford it?
If the answer to question 2 is yes, the next question is what is the best way to achieve that? As we have seen from the examples of USA and Europe, there are several different ways that need to be compared.
 
OP
OP
Seven

Seven

In bocca al lupo, Fabio.
Jun 25, 2003
35,664
@Seven @Fr3sh and anyone else who was interested in the discussion.

Finally, this took almost 3 hours to write while browsing efukt.

I will compare here the US vs EU health system and show that it’s not as simple as “the US spends more on healthcare and has a lower life expectancy, therefore US healthcare is worse.”

While I prefer the US system to the EU system, because it’s more free-market, this is not a comparison between a totally free vs socialist systems. Keep the following in mind:
1. With Obamacare, the USA is moving towards universal health coverage.
2. The government, through Medicare and Medicaid, and through tax-code subsidies, is a major player in the health services market.
3. The EU does not have a common healthcare system. Every country is different. Most people assume that the French system is the most socialist one, but that is not true. In France there are a lot of private hospitals. People pay part of their health expenses out-of-pocket and there are supplemental private health plans. In the UK almost all hospitals are government-run and healthcare is free.
4. It’s best to look at the questions of who should run hospitals and who should provide health insurance separately (and whether there should be universal health coverage).

Social cost vs $$ expenditure
1. The social cost of producing a good, for example an inflatable sex doll, is not the price of the good, but the opportunity cost, meaning how much labour and capital (machines) is needed to produce it. Example: country A needs 3 workers and 1 machine to produce a sex doll, while country B needs 5 workers and 1 machine. But in country A workers get paid $2 per sex doll they produce, while in B they’re paid $1. In both countries the cost of the machine is $2 per sex doll. Then the price of a sex doll in country A is $8 compared to $7 in country B, but country A is still more efficient in producing sex dolls, because the social cost is lower.
2. This is important in the discussion of healthcare because the social cost of healthcare in the USA is lower, or at least not greater than the OECD average (look HERE). USA has fewer doctors per person, fewer doctor visits and fewer days spent in hospital (but they do have more nurses and more medical technology per person).

Why does USA spend more $$ on healthcare than EU?
1. The US has higher income per capita than the EU and the income elasticity of healthcare spending is >1. That means that for a 1% increase in income, healthcare spending goes up by more than 1%. This is not a bad thing. As we get richer, what else should we spend our money on? Do we really need more clothes, a 3rd car, more dildos, strap on cocks and anal beads? HERE Robert Hall and Charles Jones calculate that optimal spending on healthcare is likely to exceed 30% of income by the middle of the century.
2. Doctors are paid more in the US than in Europe.
a. Part of the reason is that in the US there is a larger percentage of private hospitals, while in some EU countries, like the UK, the government is the dominant player. This situation is close to a monopsony, so the income of doctors is suppressed.
b. The other reason is that doctors pay for their own education in America by taking loans, which they have to pay back later. This means that if an American doctor earns $10 and pays $2 back, his net income is $8, while healthcare spending is $2. If a German doctor gets a free education and then earns $8, his net income is the same, total spending is also the same, but the $2 are counted as education spending, instead of healthcare spending.
3. Americans tend to spend a lot more money than Europeans on high-cost low-benefit procedures, particularly expensive life-saving procedures that have a low probability of success. One can argue whether this is good or bad, but for me it’s logical that people who have the opportunity are willing to spend a lot even for a small chance of improvement.
4. Technology. Like I mentioned before, USA uses more technology than the EU. In fact, technology is the one of the main reasons for rising healthcare costs worldwide.

Does the fact that USA spends more on healthcare and Americans have lower life expectancy necessarily mean that USA has worse healthcare than EU?
1. Looking at life expectancy alone is a wrong way to evaluate a healthcare system. There are many factors that affect it that have nothing to do with quality or even availability of healthcare. In this case the main reason for the lower life expectancy in USA is the higher homicide rate and the higher road accident mortality rate. Furthermore, Americans are much more overweight than Europeans and live a less healthy lifestyle in general. They also have a higher rate of low-birth-weight babies, due to the higher rate of teenage pregnancies. Low-birth-weight babies have a much greater mortality rate.
2. The only way to compare quality of healthcare systems is direct results. That means comparing the effectiveness in treating all medical conditions (and preventing through early check-ups). Unfortunately, this is very difficult to calculate. HERE is a study that shows that increased spending is associated with better outcomes in breast cancer treatment. HERE is a study that shows that USA is not only better (lower mortality rate and better survival rate), but is getting good value for money in cancer treatment. HERE is an article that argues in favor of using mortality rate, instead of survival rate and criticizes some of the other studies. An Analysis Of Whether Higher Health Care Spending In The United States Versus Europe Is ‘Worth It’ In The Case Of Cancer, another study criticizing this one HERE , and the response from the authors HERE.

Is there a reason to believe that USA spends more on healthcare than optimal and if so, what is the best way to reduce spending (or to reduce the growth of spending)?
1. USA is almost certainly spending more on healthcare than optimal because they are over-insured. The reason for that is that the tax code subsidizes employer-purchased insurance. It is cheaper for an employer to provide the employee with an insurance worth $X than to pay $X more in cash salary. This explains why in America almost all insurance is provided by the employer.
2. The result is that the typical health insurance is more expensive and provides more coverage than optimal. For example, most health insurances pay for routine visits and regular check-ups. Insurance is necessary for high-cost low probability events but these are low-cost almost-certain events that people can afford to pay for out of pocket. That means that the typical insurance is also a pre-payment plan for health services.
3. The way to cut down costs is to remove the preferential tax treatment for employer-provided health insurance. If people purchase their own insurance or pay out of pocket, they will cut down on unnecessary procedures and visits. Unfortunately, Obamacare has made this problem even worse.

So, what does the evidence show? The USA spends more on healthcare as % of income, but the social cost of healthcare is lower. The main reasons why USA spends more are higher income, more technology, doctors get paid more. In order to evaluate correctly whether Americans are getting their money’s worth, we need to look at the effects of treatment, while controlling for other variables that skew the results. Good studies are rare and complicated to conduct, but there is some evidence that the USA does better when it comes to cancer treatment. Still, Americans most likely spend more money than optimal on health care, due to the tax code.

Should there be universal healthcare?
This is not a simple question of economics, but more of a moral dilemma. To answer this question will take an equally long post, so I’ll do it later, but the answer depends on the following two questions:
1. Should people who can afford a health insurance, but don’t want one be forced to get it?
2. Should a health insurance be provided to those that can’t afford it?
If the answer to question 2 is yes, the next question is what is the best way to achieve that? As we have seen from the examples of USA and Europe, there are several different ways that need to be compared.

I appreciate the effort, but I can't help but feel you are tiptoeing around the major issue with fully privatized free market health care. Like I explained, an insurance is nothing more than a bet. The insurer bets on you staying healthy for a long time. For very large segments of the population this is impossible. Think cancer survivors for example or people over 70 years of age. It's not that they will simply need to pay more to get health insurance, it's also that they simply won't be able to get one at all. If the risk is too high, no insurer will offer them an insurance policy, regardless of the premium.

You even see a compareable situation with car insurance. You have several insurers who refuse to insure sports cars owned by people under 30, because the risk is just too high. Only if you apply this to healthcare, the risk is even substantially higher for the aforementioned categories of people. Someone who is 85 is always going to need healthcare. At that point, it's no longer a bet, it's a certainty. He will simply not be able to get insurance.

How do you propose to solve this?


EDIT: this article isn't perfect, but does explain it a bit more in detail http://www.huffingtonpost.com/entry...vitable_us_57bb38d0e4b0b51733a4e665?section=&
 

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L'autista
Administrator
Sep 23, 2003
75,143
Private insurance is also a failure in my eyes because federal policy directly influences personal health care as it is. That the NIH decides to fund Type 2 diabetes research, for example, but has to make budget cuts and reduces its support for Type 1 and some rarer forms of kidney disease is essentially public health funding for some individuals with care conditions but deliberate "de-funding" of others with different care conditions.

The public's fingers and money is all up in health care, and pretending that it's just a matter of individual, privatized choices is delusional.
 

AFL_ITALIA

MAGISTERIAL
Jun 17, 2011
16,162
Anyone have any thoughts on the longevity or future role of cryptocurrencies? Bitcoin has exploded since its creation, and now there's Ethereum getting interest from Russia and Singapore.

This is something I know nothing about, so I'm interested to hear some opinions. From what little I understand and as much as I don't like it, it seems to be the future and it would be wise to invest in now while it's early.
 

Quetzalcoatl

It ain't hard to tell
Aug 22, 2007
57,188
Anyone have any thoughts on the longevity or future role of cryptocurrencies? Bitcoin has exploded since its creation, and now there's Ethereum getting interest from Russia and Singapore.

This is something I know nothing about, so I'm interested to hear some opinions. From what little I understand and as much as I don't like it, it seems to be the future and it would be wise to invest in now while it's early.
I'm in the same boat as you. Now looking into it
 

Enron

Tickle Me
Moderator
Oct 11, 2005
69,132
Anyone have any thoughts on the longevity or future role of cryptocurrencies? Bitcoin has exploded since its creation, and now there's Ethereum getting interest from Russia and Singapore.

This is something I know nothing about, so I'm interested to hear some opinions. From what little I understand and as much as I don't like it, it seems to be the future and it would be wise to invest in now while it's early.
There is definitely a lot of potential. Especially in the developing world where currency is less consistent.

Read up on M-Pesa. It's not currency but it's a sign of the future as it's virtually eliminated the need to carry cash in some parts of Africa.
 

lgorTudor

Senior Member
Jan 15, 2015
23,454
I've started recently by dumping 1k€ into ETH and ARK(longterm). If ETH is going to burst soon I'll cash out and invest in some altcoin like maybe Stratis or Waves, if not I'll hold


Overall I believe crypto is a sleeping fucking giant
 

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