Getting water to China’s north

Having a safe and reliable water supply is a prerequisite for longevity. In China’s arid northern region, procuring water has always been a problem. In this week’s Economist, the magazine reports (“A modest proposal“) on some of China’s latest efforts to bring water to this region. The Chinese have already been hard at work diverting…

Medicare prescription drug co-author loses race

Nancy Johnson, a co-author of the Medicare prescription drug, has lost in her bid for re-election.  According to Fox News (“GOP Rep. Johnson loses…“), the 12-term Republican representative has lost to Democrat Chris Murphy in the Connecticut house race.  The Boston Herald (“Johnson loses…“) reports: “Murphy, 33, has slammed Johnson for her support of the…

2006 Corruption Perceptions Index

Every year Transparency International puts out a Corruption Perceptions Index ranking each country’s corruption level. The index is constructed from a survey of various resident and non-resident country experts as well as business leaders (see methodology here). The 2006 Corruption Perceptions Index gives us one clear conclusion: there is a lot of corruption in the…

The next epidemic

Health professionals are worried about the growing number of people with tuberculosis. The Health Protection Agency (HPA) website states that “in 1993 the World Health Organization (WHO) declared tuberculosis to be a global emergency.” The HPA reports the following TB statistics. TB cases (thousands) TB infection rate per 100,000 Africa 2573 356 The Americas 363…

Health Wonk Review – 2 Nov 2006 edition

 “Economic depression cannot be cured by legislative action or executive pronouncement. Economic wounds must be healed by the action of the cells of the economic body – the producers and consumers themselvesâ€? – Herbert Hoover When economists analyze any industry, their first step is to look at the incentives facing the producers and the consumers.…

Do financial incentives affect the type of breast cancer surgery a patient receives?

There are two treatment options for patients with breast cancer.  The first is a breast conserving surgery (BCS) which removes the cancerous lump (lumpectomy) followed by irradiation treatment.  The second option is a mastectomy which removes the entire breast.  Lecia Apantaku claims in the American Family Physician journal in 2002, that “survival rates following breast conservation…

The effect of financial incentives on gatekeeping doctors

In 1991 in the UK, the British began allowing general practitioners (GPs) to participate in a fundholding scheme. The fundholding program would reimburse GPs if the amount of chargeable elective secondary care procedures was below their budget and financially penalize the GPs if the amount of secondary care which their patients received exceeded their budget.…

HMO quality: Separating perception from reality

It has been shown in various studies and opinion polls that consumers generally believe that HMOs provide an inferior level of care than non-HMO plans. This is true even when more objective measures of medical service quality are taken into account. Why is HMO satisfaction so low? A study by Reschovsky, et al. (2002) claims…

Hausman Endogeneity Test

Ordinary Least Squares  If you have studied basic statistics, its likely that you have come across the ordinary least squares (OLS) estimation technique.  OLS attempts to minimize the squared distance between dependent variables (‘y‘) and the a linear prediction of y (y_hat=xβ).  The parameter vector ‘β_ols‘ minimizes this distance.  The most important assumption in order for β to reflect to true…