“The Genesis and Development of Medicare”

The following is a timeline which summarizes the genesis and evolution of government provided health insurance in the United States. Major Foreign Events: 1883: Otto von Bismark, then Chancellor of Germany passes a compulsory health insurance bill for factory and mine workers 1911: Germany extends compulsory insurance coverage to almost all employees 1911: David Lloyd…

Economists fail as evangelists on Sunset Blvd.

In the “Capitalism: The Movieâ€? in the March 2006 Atlantic Monthly, writer Clive Cook examines why many of Hollywood’s recent releases have been anti-capitalist.  Hollywood simply assumes that the public will run to see free-market bashing movies such as: Syriana, Fun with Dick and Jane, Wall Street, Erin Brockovich, The Insider, etc. Why? Cook claims…

A model of Medicaid’s poverty trap

The design of legislation which regulates Medicaid eligibility creates a poverty trap. In California, generally those who have income below 250% of the federal poverty level and who have limited assets are eligible for Medicaid. (In reality California’s Medicaid eligibility is more complicated than this. For full details of eligibility requirements see “Medi-Cal Facts and…

Did Serrano Cause Prop 13?

Passed in 1978, Proposition 13 was a ballot initiative to amend the state constitution to limit property taxes to a 1% of a homes value. The amendment also capped the annual growth rate in property value assessment at 2% per year until the house is resold.   William Fischel (1989) argues in “Did Serrano Cause…

Difference in Difference Estimation

Difference in Difference (DD) is a commonly used empirical estimation technique in economics. Let us take a hypothetical example where a state (Wisconsin) passes a bill which makes employer-provided health insurance tax deductible. Let us also assume that in the year after the bill passed (year 2) the percentage of firms offering health insurance increased…