Source: Trades Union Congress – The Pregnancy Test: Ending Discrimination at Work for New Mothers (2016).
The asymmetric marriage premium and the motherhood penalty in the UK
09 Jun 2016 Leave a comment
in discrimination, gender, labour supply, law and economics
High US drug prices as a good shot public good @RobinHoodTax
08 Jun 2016 Leave a comment
in applied price theory, comparative institutional analysis, health economics, law and economics, politics - USA, property rights Tags: best shot public goods, creative destruction, drug prices, game theory, good shot public goods, military alliances, NATO, patterns and copyrights, Warsaw Pact, weakest link public goods, World War I
Much is made of the fact that drug prices are lower in Canada and Western Europe as compared to the USA. Indeed, day trips are made across the Canadian border to buy cheaper drugs as compared to the local pharmacy pricin in a US city.
Instead of what is always the relevant public policy question. What would happen in the USA if attempts were made to seriously reduce the price of drugs. The answer is obvious, the incentive to create new drugs would be severely diminished. There are no free lunches in public policy.
Bringing in new drug to the market is a seriously expensive business these days. That is before you consider the commercial risk of inventing a drug that isn’t much better than its competitors.
Of course, you can always be leapfrogged by another drug company brining on a better drug not long after you have brought yours to market. None of this is getting any cheaper.
Innovation by specific drug company is a form of public good production known as best shot public goods. Under a best-shot rule, the socially available amount is the maximum of the individual quantities. There is is a single prize of overwhelming social importance, such as a major drug breakthrough, with any individual’s effort having a chance of securing the prize.
A specialty drug for a year costs more, on average, than most household incomes wpo.st/0y_q0 https://t.co/uss6ikgkYk—
carolyn johnson (@Carolynyjohnson) November 20, 2015
The amount to be produced of a best shot public good depends on the best contribution rather than the usual situation of any contribution is interchangeable. Another example is a large number of people shooting at an incoming missile. The best shot counts, all the others don’t matter.
High drug prices in the USA could be the price of the weakest shot or weakest link public good. Weakest shot public good is where the socially available amount is the minimum of the quantities individually provided. One example a weakest link public goods are military alliances where the success of the alliance depends upon everyone contributing
In the weakest shot or weakest link theory of public good production, the free riding countries of Europe will bring the whole show down by not making their contribution to drug research by buying at good prices from the US pharmaceutical companies.
Perhaps a better way to look at drug innovation is a good shot public good. Someone has to make a reasonable contribution; that has to be the USA because it is such a large market. Without access to good prices in the USA, there wouldn’t be enough of an incentive for drug innovation.
Military alliances such as NATO and the Warsaw Pact probably are examples of good shot public goods. They depend on a number of large countries making their contribution but I always leaned towards the crucial best shot contribution of the USA and former USSR .
In the case of the start of World War I, Triple Entente against Germany was a weaker shot public good. Its defensive wall depended on the strength of the weakest country defending i.e. the unfortified Belgian border (in both wars). The Tripartite Alliance was a best shot public good depending on the strength of Germany’s attack for ultimate success or failure.
When I grew up, we never locked the house when away
05 Jun 2016 Leave a comment
I grew up in a country town in a large family. We never locked the house when we were away because someone might be coming back and will not have the key.
There is one key to the front door and one to the back door. I never had a key to the house because it would always be unlocked. I think we locked the door when mum and dad went away for holidays.
Times change suddenly in the 1980s with a burglary epidemic associated with the increased availability of drugs. The house was always locked.
VCRs had just came out and so there was something lightweight and easy to spot that was well worth burglarising by addicts and criminal opportunists. The VCR was worth several weeks’ wages back then.
#MorganFoundation wants frontal attack on NIMBYs
03 Jun 2016 Leave a comment
in economics, economics of bureaucracy, economics of regulation, income redistribution, law and economics, property rights, Public Choice, public economics, rentseeking Tags: congestion charges, housing affordability, land supply, NIMBYs, RMA, road pricing, zoning
Morgan Foundation wants the National party-led government to take on NIMBYs not only with more high-rises and urban intensification but congestion charges too! There is only so much courage you can expect in one term of government. Relaxing the Auckland urban limit, which will hopefully cause housing prices to stop rising in Auckland was not enough.
No softly softly catchy monkey here. No concept of winning the battles you can win.
Why do the innocent plead guilty?
03 Jun 2016 Leave a comment
in applied price theory, applied welfare economics, economics of crime, law and economics Tags: over-criminalisation
Why do inmates tattoo their faces?
03 Jun 2016 Leave a comment
in applied price theory, economics of crime Tags: economics of prisons, screening, signaling
Paper Towns- Fake Places Made to Catch Copyright Thieves
02 Jun 2016 Leave a comment
in entrepreneurship, industrial organisation, law and economics, property rights, survivor principle Tags: entrepreneurial alertness, maps, patents and copyrights
Sensible Sentencing Trust mistaken to oppose plea bargaining @sst_nz
01 Jun 2016 Leave a comment
in economics of crime, law and economics, politics - New Zealand Tags: crime and punishment, game theory, law and order, plea-bargaining
The sensible sentencing trust wants to greatly curtail if not abolish plea-bargaining. Its petition is motivated by a recent plea bargain where a particularly horrendous child murder was pleaded down to two manslaughter guilty pleas.
I have no knowledge of the details of that case or the plea-bargain other than a male and female caregiver were charged with the brutal murder of a 3-year-old child in their foster care.
My speculation is two guilty pleas to manslaughter is better than one of the accused getting off through a cutthroat defence.
In this defence, the co-accused blame each other for the worst and minimises their own culpability. Sometimes this backfires. The jury convicts both on the evidence of the other but ignores self-serving testimony. But sometimes a cutthroat defence works and a guilty goes free.
A few years ago a father was accused of murdering his 3 month old twins. The chief witness against him was their mother.
By the end of the trial, his defence counsel made the mother look far more guilty than the accused. So much so that the jury returned a not guilty verdict in 10 minutes.One of the two did it, but the jury could not work out which one so there was reasonable doubt.
In the case motivating the petition to abolish plea-bargaining, the accused pleaded down to manslaughter pleas. Both are certain to be punished rather than one perhaps get off.
Plea-bargain are a compromise but they are still justice. The punishment is less but is more certain. Plea-bargaining allows scarce prosecution resources to be better targeted, which means more convictions in those cases that do go to trial.
Following Landes (1971), plea bargaining is a rational response to the costs of trial for prosecutors intent on maximizing the sum of punishments imposed on defendants as a class and for defendants seeking to minimize the expected costs of punishment to them as individuals.
A plea-bargain spares witnesses the ordeal of a trial; justice is speedier, less a severe but more certain as there is no chance of the not guilty verdict at trail. Testifying against an accused found not guilty because a reasonable doubt rather than actual innocence must be disheartening.
No @sarahinthesen8 this is not acceptable. Stopping the boats saved hundreds of lives
30 May 2016 Leave a comment
in Economics of international refugee law, international economic law, International law, labour economics, politics - Australia Tags: Australian Greens, avoiding difficult choices, economics of immigration, Leftover Left, rational irrationality
People who enter illegally by boat do not increase the number of refugees of Australia admits in any one year. They change who was granted asylum within the same fixed quota. Increasing the quota will not change incentives for illegal entry if illegal entry allows for settlement in Australia.
Economic Reasoning Applied to Sociology
30 May 2016 Leave a comment
in law and economics Tags: sociology
The Scalia Lecture | Judge Frank Easterbrook: ‘Interpreting the Unwritten Constitution’
28 May 2016 Leave a comment
in law and economics Tags: constitutional law, Frank Easterbrook
Richard Posner – WikiLeaks and the First Amendment
28 May 2016 Leave a comment
in constitutional political economy, law and economics Tags: constitutional law
Kowloon: City of anarchy
22 May 2016 Leave a comment
in economics of crime, international economics, International law, law and economics, property rights Tags: Hong Kong
Utopia, you are standing in it! 
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