Health Care as a Positional Good

February 23, 2017
Posted by Jay Livingston

Which job would you prefer.

Job A: your risk of serious injury is 10%; everyone else’s risk is 15%
Job B: your risk of serious injury is 5%; everyone else’s risk is 2%.

You’d probably take Job B, even though your risk relative to others is greater. With income, relative position carries more weight – $100,000 in a world where everyone else makes $85,000 might be more attractive that $125,000 in a world where everyone else makes $200,000.

Income is positional; safety is not.  (See the previous post for more on positional and non-positional goods.)

Health care too should be non-positional – more is better, and less is worse.  But then why would people whose healthcare had been substantially improved under Obamacare vote for the candidates and party who promised to eliminate it? That’s the question Vox’s Sarah Kliff took to Kentucky. The state had done a very good job of implementing the Affordable Care Act – expanding Medicaid and getting people to sign up on the exchanges.

But Kentuckians voted overwhelmingly for Trump and the Republicans – the people who had promised to end Obamacare. Kliff had to go back to Kentucky to find out why.

Kliff had gone there in 2016 and talked to people who, thanks to Obamacare, now go to the doctor when they are sick or injured. She talked to enrollment workers – people whose job it was to sell the program to Kentuckians, advising them of its benefits. They all voted for Trump, and after the election Kliff went back to find out why?

Some said that they didn’t think Trump really meant what he said.  Others thought that the Republicans would replace it with something better. Many had been soured by the increases in the cost of their health plans, especially high deductibles.

But many people seemed to see their own health and healthcare as a positional good. Its value depended on what others had.  “Part of their anger was wrapped up in the idea that other people were getting even better, even cheaper benefits — and those other people did not deserve the help.”

[A 59-year old woman] sees other people signing up for Medicaid, the health program for the poor that is arguably better coverage than she receives and almost free for enrolees. “They can go to the emergency room for a headache,” she says. “They’re going to the doctor for pills, and that’s what they’re on.”         She felt like this happened a lot to her: that she and her husband have worked most their lives but don’t seem to get nearly as much help as the poorer people she knows.

She has changed the terms of the discussion. It’s no longer about health, even one’s own health, it’s about morality. And apparently many people are willing to sacrifice their own health to punish the undeserving poor. 

Oller, the enrollment worker, expressed similar ideas the day we met.         “I really think Medicaid is good, but I’m really having a problem with the people that don’t want to work,” she said. “Us middle-class people are really, really upset about having to work constantly, and then these people are not responsible.”

This one really puzzled me. Medicare had helped her in a time of need, and she felt that she deserved the help it offered. Still she was willing to have it repealed because “those people” were getting a better deal.

“It’s made it affordable,” Mills says of Healthcare.gov. This year, she received generous tax credits and paid a $115 monthly premium for a plan that covered herself, her husband, and her 19-year-old son. Earlier this year, Mills’s husband was diagnosed with non-alcoholic cirrhosis of the liver. He is now on the waiting list for a liver transplant. Obamacare’s promise of health coverage, she says, has become absolutely vital in their lives. [She asked me] a few questions about what might change and whether the coverage she would sign up for in a few minutes would still be valid. I didn’t know what would happen. Our interview began to make her a bit nervous. “You’re scaring me now on the insurance part,” she said. “I’m afraid now that the insurance is going to go away and we’re going to be up a creek.”

That righteous vote to punish the undeserving poor may have seemed like a good idea at the time. But the protests at town meetings this week suggest that she might not be alone in her buyer’s remorse. In the abstract, health care may be a positional good. But when you really need medical treatment, you might not be so concerned about what other people are getting.

Is Love a Positional Good? (A Belated Valentine's Post)

February 21, 2017
Posted by Jay Livingston

Decisions, decisions.

Which world would you rather live in,  A or B World A: You have 2 weeks of vacation; others have 1 week. World B: You have 4 weeks of vacation; others have 8 weeks.

It’s a no-brainer, right? Four weeks vacation is better than two. No surprise that 85-90% of us choose World B. Now try this one.

World A: You earn $110,000 per year, others earn $200,000 World B: You earn $100,000 per year, others earn $85,000 The income figures represent real purchasing power. Thus your higher income in World A would enable you to purchase a house that is 10 percent larger than the house you would be able to afford in World B, 10 percent more restaurant meals, and so on. Faced with a once-for-all choice between these two worlds, which would you choose? (From Frank and Sunstein, here.)

This question doesn’t get the same kind of consensus.  Somewhere between a third and a half of us choose the lower income, $100,000 rather than $110,000. Why leave $10,000 on the table?

Apparently, how much your income is worth depends on its position in relation to others. Income is a “positional good.” I’ll let Sheldon Cooper explain.



How you feel about your $100,000 income depends on how much others are making. When it comes to things that employers or governments can provide, income is a positional good. What’s important is the position of your income in relation to what others are making. But vacation time is non-positional. Four weeks is better than two weeks, regardless of anyone else’s deal. Robert Frank and Cass Sunstein, who have written extensively on the topic, identify  other non-positional goods: “health care, safety, parental leave, and leisure time, are largely or primarily non-positional goods, valued for their own sake and more independently of what others have.”

This distinction closely parallels the research on happiness, which advises you to spend your money on experiences rather than objects. The happiness that a new gadget or piece of jewelry brings fades more quickly than what you would get from travel or a concert. That’s probably because as your phone or couch or sneakers grow a bit older, you start thinking about newer ones, comparing objects in the same way that people compare their incomes with those of others. We’re especially likely to compare upwards, keeping our eyes on the next and more expensive object or on the higher income. But with experiences, we’re less likely use other people’s experiences as a baseline for evaluating our own.

Besides, experiences are unique to the individual. You really can’t compare them on some universalistic scale in the same way that money allows us to compare Apples and Androids. That’s the point of all those MasterCard “Priceless” commercials. It’s the things that you can’t put a price on that are most important. They are also non-positional.

So love and relationships should be non-positional. The joke in the “Big Bang Theory” video is that some people can turn even love, or at least a girlfriend, into a positional good. The excerpt is funny because Howard admits to making the comparison downward, admitting that Raj’s being alone and miserable is “a perk.”

Comparison upwards is less funny – the Have-nots comparing themselves to the Haves and, like Raj, feeling miserable. It’s also probably more common. Think of the people who were unpaired last week on Valentine’s day. Or go to Google Images and search for “single on Valentines,” and you’ll see many variations on the alone-and-miserable theme, most of them a transparent, defensive denial. They make the same positional point: These people would not have felt so bad if it weren’t for knowing that so many others were coupled up in the world of roses and chocolates. The images also echo the message from research on happiness: positional goods (car parts!) are a poor substitute for personal, non-positional relationships.

No Evidence

February 10, 2017
Posted by Jay Livingston

The federal appeals court considering Trump’s travel ban said that the administration had provided no evidence that people from the seven countries had committed terrorist acts in the US.

Trump of course disagrees. In his view, those who oppose the travel ban – including judges and so-called judges – are ignoring a vast global threat. The cause of their ignorance is that the media are underreporting terrorism. “It’s gotten to a point where it’s not even being reported, and in many cases, the very, very dishonest press doesn’t want to report it.”

Even Fox News says that Trump is wrong. (Note that Fox puts this item under “Religion.” Apparently, saying things that aren’t true is a pillar of the Trumpist faith.)

The obvious reason for Trump’s exaggerating the threat is that it justifies his anti-Muslim and anti-immigrant policies. But some on the left suspect something broader and more ominous –  “authoritarianism, American-style,” as Paul Krugman puts it in his column in today’s New York Times:

Never mind the utter falsity of the claim that bad people are “pouring in,” or for that matter of the whole premise behind the ban. What we see here is the most powerful man in the world blatantly telegraphing his intention to use national misfortune to grab even more power.

Some on the left go even farther. Widespread fear of terror will allow Trump to stifle opposition. Those who protest Trump’s policies will no longer be merely dissenters. They will be traitors, putting the country at risk. As such, they could be thrown in jail.

The hypothesis is this: when members of a group perceive an external threat to the group, they demand more loyalty and are less tolerant of dissent.

It seems logical, and I can think of examples from recent history. But I wondered if there was any support from controlled experiments in social psychology. I asked an expert who knows the literature much better than I do (not all that difficult since I let my subscription to the JPSP lapse somewhere back in the Harding administration). The answer was that we have research on the “rally effect” –  the perception of threat causing people to rally ’round the flag and to support a strong leader.*

But what about throwing dissenters in jail, or whatever the social psych experiment analogy would be? On this, my source wrote:

“I don’t know of anything on intolerance of dissent. That might be an important literature gap to fill!”

Never mind the hint that I should sharpen up my experimenter chops and get to work. What this means for the “more threat, less tolerance of dissent” hypothesis is: “no evidence.” At least, no evidence from controlled experiments.

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* Not all of this research supports the rally effect.

Losing My Religion . . . And Its Swears

February 7, 2017
Posted by Jay Livingston

Walking across campus yesterday, I heard a loud, long belch. About ten yards away were two girls, one drinking a can of soda as they walked.

“Jesus Christ!” exclaimed her friend.

Wow, I thought, that’s something I rarely hear these days – not belching, but “Jesus Christ.” We must have found some other phrase to express a mixture of surprise and disapproval. Or was this just my idiosyncratic sampling of language?

No, my impression was correct.  Linguist Melissa Mohr, author of Holy Sh*t: A Brief History of Swearing, says that “Jesus Christ” doesn’t even make it into the top 20 among swears these days. as religion become more powerful and able to impose its taboos? Just the opposite. Religion is declining in importance, especially among the young, and as a consequence, religious swears have lost the power entwined with taboo.

Religious swears – words once deemed blasphemous – are now perfectly acceptable.  The Hollywood Production Code of 1927 banned damn, hell, God, Jesus, Christ, and even lord (unless used in a religious sense). The Code faded in the 1950s, but television adopted many of its rules. That was then. Now, if you told young people told that invoking the lord’s name was once unacceptable, they would probably text back, “OMG, why?” 

Some of those no-longer-powerful religious curses are being replaced with sex-based terms. In earlier generations, you might have said that a room was “hot as hell.” Now, it’s “hot as fuck.” As a simile, it makes no sense, but fuck emphasizes the heat in a way that hell no longer does.

I’m not sure what most college-age people would say these days when a friend unabashedly emits a loud belch. I am not a religious Christian; I’m just old. So I found it comforting to hear America’s youth repeating the familiar words, “Jesus Christ!”