The United States spends substantially more on health care than most developed countries, yet leaves a greater share of the population uninsured. We argue that incremental insurance expansions focused on addressing market failures will propagate inefficiencies and will fail to facilitate the active policy decisions needed to achieve socially optimal coverage. By instead defining a basic bundle of services that is publicly financed for all, while allowing individuals to purchase additional coverage, policymakers could both expand coverage and maintain incentives for innovation, ensuring universal access to innovative care in an affordable system.
{"title":"Achieving Universal Health Insurance Coverage in the United States: Addressing Market Failures or Providing a Social Floor?","authors":"Katherine Baicker, Amitabh Chandra, Mark Shepard","doi":"10.1257/jep.37.2.99","DOIUrl":"https://doi.org/10.1257/jep.37.2.99","url":null,"abstract":"The United States spends substantially more on health care than most developed countries, yet leaves a greater share of the population uninsured. We argue that incremental insurance expansions focused on addressing market failures will propagate inefficiencies and will fail to facilitate the active policy decisions needed to achieve socially optimal coverage. By instead defining a basic bundle of services that is publicly financed for all, while allowing individuals to purchase additional coverage, policymakers could both expand coverage and maintain incentives for innovation, ensuring universal access to innovative care in an affordable system.","PeriodicalId":15611,"journal":{"name":"Journal of Economic Perspectives","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-05-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135337442","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We study changing trends in within-city sorting by education over the last 40 years. We show that neighborhoods closest to the centers of large US cities rose from having the lowest levels of college attainment in 1980 to the highest in 2017. We discuss the determinants of changes in sorting patterns, focusing on the role of transportation technology and income growth. We outline various consequences of the recent urbanization of college graduates on neighborhood amenities, house prices, and segregation. We highlight the tendency of college graduates to cluster into select central neighborhoods, likely limiting opportunities for interactions across educational lines.
{"title":"Neighborhood Change, Gentrification, and the Urbanization of College Graduates","authors":"Victor Couture, Jessie Handbury","doi":"10.1257/jep.37.2.29","DOIUrl":"https://doi.org/10.1257/jep.37.2.29","url":null,"abstract":"We study changing trends in within-city sorting by education over the last 40 years. We show that neighborhoods closest to the centers of large US cities rose from having the lowest levels of college attainment in 1980 to the highest in 2017. We discuss the determinants of changes in sorting patterns, focusing on the role of transportation technology and income growth. We outline various consequences of the recent urbanization of college graduates on neighborhood amenities, house prices, and segregation. We highlight the tendency of college graduates to cluster into select central neighborhoods, likely limiting opportunities for interactions across educational lines.","PeriodicalId":15611,"journal":{"name":"Journal of Economic Perspectives","volume":null,"pages":null},"PeriodicalIF":8.4,"publicationDate":"2023-05-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47434531","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
A. Banerjee, E. Duflo, Erin Grela, Madeline McKelway, Frank Schilbach, Garima Sharma, Girija Vaidyanathan
We combine data from longitudinal surveys in seven low- and middle-income countries (plus the United States for comparison) to document that depressive symptoms among those aged 55 and above are prevalent in those countries and, unlike in the United States, increase sharply with age. Depressive symptoms in one survey wave are associated with a greater decline in ability to carry out basic daily activities and a higher probability of death in the next wave. Using additional data from a panel survey we conducted in Tamil Nadu with a focus on elderly living alone, we document that social isolation, poverty, and physical health challenges are strongly correlated with depression. We discuss potential policy interventions in these three domains, including some results from our randomized control trials in the Tamil Nadu sample.
{"title":"Depression and Loneliness among the Elderly in Low- and Middle-Income Countries","authors":"A. Banerjee, E. Duflo, Erin Grela, Madeline McKelway, Frank Schilbach, Garima Sharma, Girija Vaidyanathan","doi":"10.1257/jep.37.2.179","DOIUrl":"https://doi.org/10.1257/jep.37.2.179","url":null,"abstract":"We combine data from longitudinal surveys in seven low- and middle-income countries (plus the United States for comparison) to document that depressive symptoms among those aged 55 and above are prevalent in those countries and, unlike in the United States, increase sharply with age. Depressive symptoms in one survey wave are associated with a greater decline in ability to carry out basic daily activities and a higher probability of death in the next wave. Using additional data from a panel survey we conducted in Tamil Nadu with a focus on elderly living alone, we document that social isolation, poverty, and physical health challenges are strongly correlated with depression. We discuss potential policy interventions in these three domains, including some results from our randomized control trials in the Tamil Nadu sample.","PeriodicalId":15611,"journal":{"name":"Journal of Economic Perspectives","volume":null,"pages":null},"PeriodicalIF":8.4,"publicationDate":"2023-05-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47358923","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The event study model is a powerful econometric tool used for the purpose of estimating dynamic treatment effects. One of its most appealing features is that it provides a built-in graphical summary of results, which can reveal rich patterns of behavior. Another value of the picture is the estimated pre-event pseudo-“effects,” which provide a type of placebo test. In this essay I aim to provide a framework for a shared understanding of these models. There are several (sometimes subtle) decisions and choices faced by users of these models, and I offer guidance for these decisions.
{"title":"An Introductory Guide to Event Study Models","authors":"Douglas L. Miller","doi":"10.1257/jep.37.2.203","DOIUrl":"https://doi.org/10.1257/jep.37.2.203","url":null,"abstract":"The event study model is a powerful econometric tool used for the purpose of estimating dynamic treatment effects. One of its most appealing features is that it provides a built-in graphical summary of results, which can reveal rich patterns of behavior. Another value of the picture is the estimated pre-event pseudo-“effects,” which provide a type of placebo test. In this essay I aim to provide a framework for a shared understanding of these models. There are several (sometimes subtle) decisions and choices faced by users of these models, and I offer guidance for these decisions.","PeriodicalId":15611,"journal":{"name":"Journal of Economic Perspectives","volume":null,"pages":null},"PeriodicalIF":8.4,"publicationDate":"2023-05-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44243707","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The US urban population increased by almost 50 percent between 1980 and 2020, with this growth heavily concentrated in the Sun Belt and at the fringes of metropolitan areas. This paper considers the role of housing supply in shaping the growth of cities and neighborhoods. Housing supply constraints have meant that demand growth has increasingly manifested as price growth rather than as increases in housing units or population in larger and denser metropolitan areas and neighborhoods. New housing is provided at increasingly higher cost in areas that have higher intensity of existing development and more restrictive regulatory environments. Both forces have strengthened over time, making quantity supplied less responsive to growing demand, driving housing price growth in many areas, and pushing housing quantity growth further out into urban fringes. As a result of such pressures on the cost of new construction, the US has recently experienced more rapid price growth and a declining influence of new construction on the housing stock.
{"title":"Constraints on City and Neighborhood Growth: The Central Role of Housing Supply","authors":"Nathaniel Baum-Snow","doi":"10.1257/jep.37.2.53","DOIUrl":"https://doi.org/10.1257/jep.37.2.53","url":null,"abstract":"The US urban population increased by almost 50 percent between 1980 and 2020, with this growth heavily concentrated in the Sun Belt and at the fringes of metropolitan areas. This paper considers the role of housing supply in shaping the growth of cities and neighborhoods. Housing supply constraints have meant that demand growth has increasingly manifested as price growth rather than as increases in housing units or population in larger and denser metropolitan areas and neighborhoods. New housing is provided at increasingly higher cost in areas that have higher intensity of existing development and more restrictive regulatory environments. Both forces have strengthened over time, making quantity supplied less responsive to growing demand, driving housing price growth in many areas, and pushing housing quantity growth further out into urban fringes. As a result of such pressures on the cost of new construction, the US has recently experienced more rapid price growth and a declining influence of new construction on the housing stock.","PeriodicalId":15611,"journal":{"name":"Journal of Economic Perspectives","volume":null,"pages":null},"PeriodicalIF":8.4,"publicationDate":"2023-05-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43705120","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Economic activity is highly unevenly distributed within cities, as reflected in the concentration of economic functions in specific locations, such as finance in the Square Mile in London. The extent to which this concentration reflects natural advantages versus agglomeration forces is central to a range of public policy issues, including the impact of local taxation and transport infrastructure improvements. This paper reviews recent quantitative urban models, which incorporate both differences in natural advantages and agglomeration forces, and can be taken directly to observed data on cities. We show that these models can be used to estimate the strength of agglomeration forces and evaluate the impact of transportation infrastructure improvements on welfare and the spatial distribution of economic activity.
{"title":"Quantitative Urban Models: From Theory to Data","authors":"S. Redding","doi":"10.1257/jep.37.2.75","DOIUrl":"https://doi.org/10.1257/jep.37.2.75","url":null,"abstract":"Economic activity is highly unevenly distributed within cities, as reflected in the concentration of economic functions in specific locations, such as finance in the Square Mile in London. The extent to which this concentration reflects natural advantages versus agglomeration forces is central to a range of public policy issues, including the impact of local taxation and transport infrastructure improvements. This paper reviews recent quantitative urban models, which incorporate both differences in natural advantages and agglomeration forces, and can be taken directly to observed data on cities. We show that these models can be used to estimate the strength of agglomeration forces and evaluate the impact of transportation infrastructure improvements on welfare and the spatial distribution of economic activity.","PeriodicalId":15611,"journal":{"name":"Journal of Economic Perspectives","volume":null,"pages":null},"PeriodicalIF":8.4,"publicationDate":"2023-05-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46469117","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Governments in many low- and middle-income countries are developing health insurance products as a complement to tax-funded, subsidized provision of healthcare through publicly-operated facilities. We discuss two rationales for this transition. First, health insurance would boost fiscal revenues for healthcare, as post-treatment out-of-pocket payments to providers would be replaced by pre-treatment insurance premia to health ministries. Second, increased patient choice and carefully designed physician reimbursements would increase quality in the healthcare sector. Our essay shows that, at best, these objectives have only been partially met. Despite evidence that health insurance has provided financial protection, consumers are not willing to pay for unsubsidized premia. Health outcomes have not improved despite an increase in utilization. We argue that this is not because there was no room to improve the quality of care but because behavioral responses among healthcare providers have systematically undermined the objectives of these insurance schemes.
{"title":"The Prices in the Crises: What We Are Learning from 20 Years of Health Insurance in Low- and Middle-Income Countries","authors":"Jishnu Das, Quy-Toan Do","doi":"10.1257/jep.37.2.123","DOIUrl":"https://doi.org/10.1257/jep.37.2.123","url":null,"abstract":"Governments in many low- and middle-income countries are developing health insurance products as a complement to tax-funded, subsidized provision of healthcare through publicly-operated facilities. We discuss two rationales for this transition. First, health insurance would boost fiscal revenues for healthcare, as post-treatment out-of-pocket payments to providers would be replaced by pre-treatment insurance premia to health ministries. Second, increased patient choice and carefully designed physician reimbursements would increase quality in the healthcare sector. Our essay shows that, at best, these objectives have only been partially met. Despite evidence that health insurance has provided financial protection, consumers are not willing to pay for unsubsidized premia. Health outcomes have not improved despite an increase in utilization. We argue that this is not because there was no room to improve the quality of care but because behavioral responses among healthcare providers have systematically undermined the objectives of these insurance schemes.","PeriodicalId":15611,"journal":{"name":"Journal of Economic Perspectives","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-05-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135504495","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Monetary policy affects financial markets and the broader economy in part by changing the risk appetite of investors. This article provides new evidence for this so-called risk-taking channel of monetary policy by revisiting and extending event-study analysis of Federal Open Market Committee announcements. We document significant effects of unexpected monetary policy changes on risk indicators drawn from equity, fixed-income, credit, and foreign exchange markets. We develop a new index of risk appetite based on the common component of these indicators. Surprise monetary easing leads to strong and persistent increases in our index, and vice versa for tightening surprises, consistent with the view that monetary policy affects asset prices in large part through its effects on risk appetite. We discuss the implications of the risk-taking channel for monetary policy transmission, optimal monetary policy, and financial stability.
{"title":"Risk Appetite and the Risk-Taking Channel of Monetary Policy","authors":"M. Bauer, B. Bernanke, Eric Milstein","doi":"10.1257/jep.37.1.77","DOIUrl":"https://doi.org/10.1257/jep.37.1.77","url":null,"abstract":"Monetary policy affects financial markets and the broader economy in part by changing the risk appetite of investors. This article provides new evidence for this so-called risk-taking channel of monetary policy by revisiting and extending event-study analysis of Federal Open Market Committee announcements. We document significant effects of unexpected monetary policy changes on risk indicators drawn from equity, fixed-income, credit, and foreign exchange markets. We develop a new index of risk appetite based on the common component of these indicators. Surprise monetary easing leads to strong and persistent increases in our index, and vice versa for tightening surprises, consistent with the view that monetary policy affects asset prices in large part through its effects on risk appetite. We discuss the implications of the risk-taking channel for monetary policy transmission, optimal monetary policy, and financial stability.","PeriodicalId":15611,"journal":{"name":"Journal of Economic Perspectives","volume":null,"pages":null},"PeriodicalIF":8.4,"publicationDate":"2023-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47762320","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Trefor Owen Morgan, Constantinos Syropoulos, Y. Yotov
Taking an interdisciplinary perspective, we examine the evolution of economic sanctions in the post-World War II era and reflect on the lessons that could be drawn from their features and patterns of use. We observe that, during this time, there has been a remarkable increase in the use of sanctions as an instrument of foreign policy. We classify this period into four ‘eras’ and discuss, in this context, how the evolution of sanctions may be linked to salient features of the contemporaneous international political and economic orders. Our review of the related literatures in economics and political science suggests, among other things, that our understanding of sanction processes could be significantly advanced by marrying these perspectives. We conclude by identifying several questions and challenges, and by discussing how interdisciplinary research could address them.
{"title":"Economic Sanctions: Evolution, Consequences, and Challenges","authors":"Trefor Owen Morgan, Constantinos Syropoulos, Y. Yotov","doi":"10.1257/jep.37.1.3","DOIUrl":"https://doi.org/10.1257/jep.37.1.3","url":null,"abstract":"Taking an interdisciplinary perspective, we examine the evolution of economic sanctions in the post-World War II era and reflect on the lessons that could be drawn from their features and patterns of use. We observe that, during this time, there has been a remarkable increase in the use of sanctions as an instrument of foreign policy. We classify this period into four ‘eras’ and discuss, in this context, how the evolution of sanctions may be linked to salient features of the contemporaneous international political and economic orders. Our review of the related literatures in economics and political science suggests, among other things, that our understanding of sanction processes could be significantly advanced by marrying these perspectives. We conclude by identifying several questions and challenges, and by discussing how interdisciplinary research could address them.","PeriodicalId":15611,"journal":{"name":"Journal of Economic Perspectives","volume":null,"pages":null},"PeriodicalIF":8.4,"publicationDate":"2023-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46344555","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
“Soft landings,” that is, cases in which the central bank tightens monetary policy to fight inflation but does not cause a recession (which would be a “hard landing”, are thought to be difficult to achieve and extremely rare. According to the conventional wisdom, the Federal Reserve has managed to achieve only one soft landing in the past 60 years—in 1994–1995. This paper studies the eleven episodes of monetary policy tightening by the Fed since 1965, and concludes that the central bank has a better record than that—that as long as the criteria for softness are not too stringent, and Fed was actually trying to land the economy softly, the Fed has succeeded several times. Achieving a soft landing, however, requires both skill in managing monetary policy and the absence of adverse external shocks.
{"title":"Landings, Soft and Hard: The Federal Reserve, 1965–2022","authors":"A. Blinder","doi":"10.1257/jep.37.1.101","DOIUrl":"https://doi.org/10.1257/jep.37.1.101","url":null,"abstract":"“Soft landings,” that is, cases in which the central bank tightens monetary policy to fight inflation but does not cause a recession (which would be a “hard landing”, are thought to be difficult to achieve and extremely rare. According to the conventional wisdom, the Federal Reserve has managed to achieve only one soft landing in the past 60 years—in 1994–1995. This paper studies the eleven episodes of monetary policy tightening by the Fed since 1965, and concludes that the central bank has a better record than that—that as long as the criteria for softness are not too stringent, and Fed was actually trying to land the economy softly, the Fed has succeeded several times. Achieving a soft landing, however, requires both skill in managing monetary policy and the absence of adverse external shocks.","PeriodicalId":15611,"journal":{"name":"Journal of Economic Perspectives","volume":null,"pages":null},"PeriodicalIF":8.4,"publicationDate":"2023-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43433506","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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