Opportunity and Choice

Bonnie Ghosh-Dastidar and Tamara Dubowitz of the RAND Corporation posted an article yesterday examining how well the theorized link between obesity and so-called ‘food deserts’ holds up to empirical scrutiny. Though the link between obesity and distance to full-service grocers has taken on the status of stylized fact in much of the public policy literature, Ghosh-Dastidar and Dubowitz observe that “there is little rigorous evidence to support the notion that food deserts are driving the obesity epidemic.” Having grown up in low-income urban communities, I have often been at a loss for why ‘choice’ is the only explanation for eating habits not worthy of serious consideration. Sure, choice does not tell the whole story. But surely it tells us more than the literature allows. If we were examining patterns of dress for this same demographic, we might sensibly conclude that the choice of apparel—while by no means independent of income, education, age, etc.—is essentially a function of a set of aesthetic norms embedded within the cultural community which informs (but does not strictly constrain) the tastes and choices of individuals nested within the community. Let’s refer to such modes of dress as urban fashion.

Like all analogies, this one is limited. We, for example, would classify obesity as a public health problem; the same cannot be said for urban fashion. Yet urban fashion is not without consequence for an individual’s life chances. I recall as a young man learning that I would have to abandon many norms of dress to which I was accustomed and adopt sartorial norms which I found foreign. Such was required if I was to be taken seriously in the job market and in other social contexts. Adaptation is not without psychic costs, and many of my peers chose to forego these costs, considering the associated benefits remote and speculative. My point here is that while the choice of my peers adhere to their preferred patterns of dress might have hindered the achievement of other goals, we needn’t contrive a complex theoretical framework to understand the phenomena in question. It is not that hard to understand. In my case, my eating habits changed for the same reasons my style of dress changed: my values changed, and I chose.

A while back, in a critical review of the book Place Matters: Metropolitics for the Twenty-first Century, I took issue with what I viewed as a central bias of that collection of scholarly essays. I said that the authors seemed to require that the reader

be willing to discuss issues of urban decay without reference to any agency in urban dwellers themselves—urban residents come across as flat characters in a narrative that only contemplates victims and villains. The authors are dismissive of arguments or evidence that counterproductive norms and dysfunctional behavior within inner city communities contributes to the environment. They make clear that their focus is on opportunity structures and not behaviors (66). Examining structural causes is needful; declining to give way to condescending moralizing is admirable. But the authors err on the opposite extreme by romanticizing urban dwellers and leave no room for individual agency in the account of their lives. Hence, high rates of obesity are the results of parents being afraid to let their children play outside in dangerous areas and the lack of healthy food options in inner city food deserts…One wonders what the authors do with studies in the food insecurity literature which suggests that unhealthy eating habits persist even when more nutritious foods are available and even when such foods are subsidized.

Ghosh-Dastidar and Dubowitz’s research

published in the American Journal of Preventive Medicine, shows that factors other than location may have greater sway over how and where consumers shop. Store choice may reflect individual factors, such as personal food preference and income, as well as store characteristics, such as availability, quality, pricing, and point-of-sale advertising of food.

After accounting for prices of items offered at food retail outlets, distance to where residents shopped was not associated with obesity.

Imagine that: personal food preference might actually be a factor in eating habits and obesity. Opportunity matters but so do choices. It is not an either/or proposition.

A.K.

Textbook Price Inflation

The Economist reports that textbook prices continue to climb several times the general rate of inflation:

Textbook Prices

 

But hope is not lost for poor scholars. Foreign editions are easy to find online and often cheaper—sometimes by over 90%. Publishers can be litigious about this, but in 2013 the Supreme Court ruled that Americans have the right to buy and resell copyrighted material obtained legally. Many university bookstores now let students rent books and return them. Publishers have begun to offer digital textbooks, which are cheaper but can’t be resold. And if all else fails, there is always the library.

They note that one of the main reasons for the constant climb is a type of moral hazard: the person deciding which textbook to assign (the instructor) is not the same person who has to come up with the cash (the student). The professor can get an examination copy of the book for free, decide if he/she likes it, and make the call–totally insensitive to whether the marginal value added by the selected text justifies the marginal expense when compared to alternative materials. Some instructors can be quite considerate of cost–I like to think that I am–but instructors are also busy people juggling many responsibilities and trying to find materials quickly which make their own lives easier. Of course publishers are aware of this and market their products accordingly. My advice? Use the secondary markets as much as possible: buy used, buy online, buy the overseas edition, borrow or rent where possible, resell (unless it’s a definite keeper!) quickly before the next edition comes out, or buy a digital edition.

Unintended Consequences…In Porn?

Los Angeles has long been dubbed the king of the porn industry where many X-rated productions are shot. However, last year  film permits were down 90% (40 permits compared to 485) and this year only 20 permits have been issued. This is all a result of a measure that was put up to a vote by L.A. County voters in November 2012 titled Measure B.  This measure was passed and mandated that all male performers must wear a condom. Advocates believed that using a condom would prevent the spread of AIDS, but actors, production companies and fans have responded a bit differently than voters may have intended.

“We’re not shooting in L.A. anymore,” said Steven Hirsch, founder and co-chairman of Vivid Entertainment. “We’d like to stay here. This is our home, where we’ve produced for the last 30 years. But if we’re forced to move, we will.”

Actors are not wearing protection, because fans do not want to see it. Production companies are moving outside of L.A. County to places as far as Europe. In many cases, companies are filming without permits so the potential spread of diseases is not actually decreasing, rather it has just moved elsewhere. (As a general note, porn performers are tested every 2 weeks for HIV and other sexually transmitted diseases. 2004 was the last known case for an actor to contract HIV on set.) L.A. County voters, who may have thought they were acting morally by voting for Measure B, not only took away the right for companies to operate as a way they best see fit, but they also are hurting a $7 billion dollar a year industry…and all the tax dollars that come from it.

Law School Bubble: Follow the Money

I wrote some time ago about the apparent bubble in higher education. Many of the commentators I cited in that post blamed climbing costs on the  pathologies in higher ed administration, misplaced incentives arising from college rating schemes, uninformed student demand for campus amenities and pursuit of majors which are not economically viable, and the easy credit spigot flowing out of the federal student loan program.

I recently came across an article in the The American Lawyer in which Steven J. Harper, himself a lawyer and adjunct law professor, argues that new law schools continue to open their doors despite the terrible post-graduation employment rate because federal student loan money is way too easy to come by.

Harper then tells the story of Charleston School of Law, a private law school which is in financial trouble related to mismanagement:

What was the source of Charleston’s now-distributed profits? The answer appears on the law school’s website: “Most students will depend on federal student loans to pay for tuition, books and living expenses while in law school. During the 2012-2013 academic year, 88 percent of our students borrowed student loans to finance their legal education. At graduation, the average student loan debt incurred for those borrowers while attending the Charleston School of Law was $146,595.”

Nine months after graduation, 53 percent of the school’s class of 2013 had found full-time long-term jobs requiring a J.D. (More than half of those were working in firms of fewer than 10 attorneys.)

So at Charleston, student debtors finance profit distributions to law school owners who have no accountability for poor graduate outcomes. When the school later hits the financial skids, only InfiLaw, another for-profit organization, can rescue it.

Wealth redistribution takes many forms, but none produces results more perverse than the current system for financing—and profiting from—legal education.

Read more: http://www.americanlawyer.com/id=1202657503843/A-Tale-of-Two-Law-Schools#ixzz33VwokOI8

 

A.K.

Math Ranking Down, Reading Up for U.S. Students

In a recent Program for International Student Assessment (PISA) ranking, the U.S. fell in its math rankings from #34 to #36, while it went from not ranked in reading to #23, all in a 6 year time frame.  Big “surprises” are China which wasn’t surveyed in 2006, but leads both categories along with other Asian countries like Hong Kong, Singapore, Japan, South Korea, and Taiwan.  Canada is ranked #12 in math (down from #7) and #8 in reading (down from #4) from 2006-2012. This survey is based off of testing 15 year olds on basic academic skills.  One criticism that comes to mind, especially in countries like China, is that students only have to attend school for 9 years.  So, families, especially those in rural areas, often elect not to continue educating their children after 15.  This is a sample selection problem. In simple terms, the students tested by the PISA will only be the students whose families want to keep them in school, which usually includes the rich, smart, educated or those with highest educated earning potential.  The students who aren’t as smart or have a smaller potential to earn more money by continuing education drop out and work in the family business or on a farm. Therefore, the PISA rankings are slightly bias because they only sample China’s best students.  Now, a case can be made in other countries it is the same and I agree that it is true to some degree. In developed countries some states or provinces allow students to drop out also at 15 or 16, but high school drop out rates are small.  (They are roughly 7% in the U.S.) So, although this assessment is an indication of where countries rank side-by-side there are some issues with devising policy upon it.  Are there any other issues you see?

3 Things on Health Care Reform We ALL Can Agree On

Obamacare is the law of the land and it’s here to stay. That is one of the small points made in a lecture I attended yesterday from the Institute of Humane Studies held at Clemson University.  The panel brought together  four interesting individuals, some liberal, some conservative, some libertarian–all with different backgrounds and different fields.  One worked as a Public Health Administrative, one an Emergency Room Doctor, one for the Center for American Progress and the last for the Insurance Commission in South Carolina.  Some argued we need the government to fix health care and some argued we only need the Altogether it was an excellent forum to here many different opinions.

The Obamacare discussion occurred in my classroom this week as well, with my mother on the phone and even for nearly two hours on some carry-over points from last night’s forum with a colleague whose office is across the hall.  (He researches on health care efficiency and I thoroughly enjoyed what he had to say.  Some of his points influenced what I am about to say as well.) The Obamacare debate is also probably one that you see politicians bicker about on a daily basis and perhaps even one that you may have argued for or against. I am not trying to argue about what is right or wrong. I am here to talk about 3 basic truth’s behind health care reform and what individuals, from either side of the political spectrum, DO agree on.

 

1. The system was broken before the law was passed. The Affordable Care Act, or what been dubbed Obamacare, is a law that actually was passed in 2010. There is a lot of stir in recent months because some parts of the law are just now being phased in. Few individuals truly feel that this act will solve all of our problems, but the prior system to 2009 was not good.    However, “we all [can] agree what we’d like to see: Health care needs to become efficient, innovative, and provide high quality care at reasonable cost,” John Cochrane, Professor of Finance at the University of Chicago. This act may NOT make things more efficient or less costly, and some may argue it will make it worse, but one thing we can agree upon is that the system was broken and we need a lower cost, more efficient system. What we disagree on is how we get to that point, what we we agree upon is that we need to get to that point.

2. Either President Obama lied and said individuals who had private plans could keep their insurance plans OR his economists lied to him. Basic economics will tell you that when you add a constraint to a problem (i.e. a government regulation that says you cannot drop those who have pre-existing conditions or you cannot screen against them) then the entire problem changes. If a private corporation is going to take on more sickly people or at least those with a higher probability of being sick, their entire business model must change in order to make profit and stay in business.  This means that some costlier plans that private insurers previously offered may get cut or premiums must increase for the healthy to cover the potential, and likely, outpour of dollars to cover those with pre-existing conditions. In some cases, both happened. Although I am not sure who lied to whom initially, I am less inclined to believe that President Obama lied to the American people so openly. This is not to say that politicians do not lie, this is more to say that his entire presidential legacy rests on Obamacare. Openly lying about something that cost millions of Americans their insurance plans is detrimental to his career.  Rather, I think his economists, who are educated in some of the best economic institutions in the world, lied to him to please the Democratic party.  President Obama was just the one who delivered the false information.  (Don’t kill the messenger?)

 

3. Both sides will not agree on health care reform.  Plain and simple, both sides see two different solutions to the problem.  A more libertarian argument may suggest that government interference has caused prices to rise in the health care industry. More government regulation and interference causes these prices to rise higher than they would if the private market was allowed to just compete together. An example of a proposed solution would be to have no employer insurance and no government insurance, just individuals buying their own plan.  The hope would be that this would cause costs to decrease, increased competition and better health care efficiency. A more liberal argument would suggest that the government should be the only provider of health care, which would equalize all forms of treatment and services.  This will allow those with pre-existing conditions to have the same care at the same cost to those who are healthy.  The hope would be that this causes costs to decrease, less competition and better health care efficiency.  There are also solutions that many favor that are less extreme to either end or solutions that are a hybrid  private and public solution.  Regardless, both sides believe there are different means to come to the same end. Both sides do not agree. This is not to say that there can not be compromise, but to get full support of one solution is near impossible. Let’s stop trying to pretend that there is ONE golden solution we all will agree on.

 

In sum, the Affordable Care Act is the law of the land. Will it solve all of our problems? Only time will tell. I am less inclined to think that it is the be-all-end-all fix to health care reform, but a movement to start discussing BETTER ways to cut costs and make health care more efficient.  Although everyone can disagree on the BEST solution  to fix the problem, the three things we all can agree on is that the health care system was broken before, both sides will not agree on one solution, and there was no way it made financial sense for private insurance companies to keep old plans in face of the new ACA regulation.  (Unless of course, there is executive order and a government promise to pay for the losses if private insurance companies reinstate old plans.  However, this is another issue that A.K. will touch upon in a post later this week. )  In the meantime, listen to other’s opinions on health care reform and continue to educate yourself.  This debate is far from over and as more possible solutions are thrown around you want to understand why it may work and why it may not. My colleague, Richard Gearhart, enlightened me to one  proposed solution where we are given health care insurance when we are born and can “opt out” of health care starting at age 26 and private health savings accounts can be carried over year to year. The poor would get private health savings accounts with a fixed amount of gov’t money per year, which would eliminate a need for Medicaid and some other hotly contested welfare programs. His solution is a private and public one.   I’m not saying I’m convinced (or ever will be), but health care reform is not over.

 

To show you the strong debate between both sides and how one golden solution is near impossible, here are some blogs on Obamacare:

Wage Debate Too Low for Adjunct Professors??

My colleague, Adam Millsap, wrote an interesting article on the appropriateness of adjunct wages in the Tiger News that has gotten a lot of heat from fellow professors and adjuncts at Clemson University. (This is apparent based upon the high number of online views and vicious comments on the article.)  This paper is also in print, so his article has spread to a wide audience.  I think he brings up two solid economic points in his article about opportunity cost and demand/supply being the cause of what some would call ‘low’ wages.   He also argues against an opposing argument that colleges and universities are colluding to set low wages.  I think this article is a great read and definitely worth a discussion. Without spoiling too much of his argument, take a look for yourself.

adjunct

Adjunct pay is a current “hot” topic following the Duquesne University adjunct death.  A quote by CNN writer Gary Rhoades states that:

“Adjunct professors [are].. part of a growing army of working poor”

Meanwhile, Tuft’s University formed one of the firm adjunct faculty labor unions.
one-does-not-simply-become-an-adjunct-professor