Should-Watch: Josh Blumenstock: Fighting Poverty with Data: Research at the Intersection of Machine Learning and Global Development: “Work that capitalizes on recent advances in machine learning to tackle some of the problems affecting poor and marginalized populations…

…Afghanistan, Indonesia, and Rwanda… how large-scale data from mobile phone and satellite networks can be combined with on-the-ground experiments and surveys to better understand the causes and consequences of global poverty. Throughout, I will highlight open technical research questions where the right computer scientist or statistician has the opportunity to make a lasting real-world impact…

Should-Read: Ann Marie Marciarille: Anthem-CVS: What Would Consumers Get Out of It?: “The claim that all chronic care  delivery will be miraculously transformed by the Anthem-CVS merger (and inevitable “me too” mergers between other drugstore chains/PBMs and other health insurers) requires a skeptical view…

…I get the claim, that re-aligning the incentives in chronic care so that PBMs/drug stores are on the same side for chronic disease management and not in a war of treatment modalities will produce better chronic disease management….

CVS-branded minute clinics for diabetes management counseling, for example… better cheaper access… diet? exercise? the risks of unmonitored polypharmacy? the need for group diabetes education and support, sometimes called diabetes self-management education? Think again. Have the people proposing this ever even been to a CVS minute clinic? Continuity of care is not  their watchword. Or, perhaps they are talking about the CVS minute clinic of the future, analogous to the CVS-V.A. alliances being piloted in Arizona or elsewhere, complete with electronic medical record information sharing. In the meantime, minute clinics work on a business model that skims the easier less complex cases from primary care….

Would the combined Anthem-CVS turn its CVS housed minute clinics into Diabetes diagnosis and prevention centers targeting the real challenges of individuals with diabetes in the community? After all, wouldn’t that be what it would take to create those synergies of better chronic disease management for diabetes in the post-merger world? Well, it depends on how the business would be structured and how the services would be reimbursed. Color me skeptical in a world where one of the newest CMS posted-regulations guts or undermines some of the most promising outcome-based bundled reimbursement experiments ever proposed…

Should-Read: Sarah Kliffe: A health merger expert explains the CVS-Aetna deal: ” Martin Gaynor…. There are a lot fewer ‘vertical mergers’ of actors in the health care system that do different things…

…CVS… one of the country’s largest pharmacy benefit managers… contract with large health insurance plans to manage their drug benefits… sits down and negotiates prices with pharmaceutical manufacturers…. This is the integration between CVS and Aetna that health wonks are especially interested in…. It’s possible this type of merger could actually be good for consumers…. Even if the merger does eliminate some of the costs of a middleman, that doesn’t mean consumers necessarily benefit…. “It could pass merger review, but that doesn’t necessarily mean it will end up being a great thing for consumers…”

Should-Read: Todd Vasos: The Dollar General CEO just accidentally made clear how screwed up the economy is: “The economy is continuing to create more of our core customer…

…[who] doesn’t look at her pantry or her refrigerator and say, ‘You know, I’m going to be out of ketchup in the next few days. I’m going to order a few bottles. The core customer uses the last bit of ketchup at the table the night prior, and either on her way to work or on her way home picks up one bottle…. We are putting stores today [in areas] that perhaps five years ago were just on the cusp of probably not being our demographic, and it has now turned to being our demographic…

Must-Read: I do not think Jason and Larry are shrill enough here. The Nine Unprofessional Republican Economists sought to convince people like Susan Collins that the tax “reform” would roughly pay for itself with their “raise the level of GDP in the long run by just over 4%. If achieved over a decade, the associated increase in the annual rate of GDP growth would be about 0.4% per year”. They then seek, subsequently, to preserve some shred of their professional reputations by claiming that “we did not offer claims about the speed of adjustment to a long-run result”.

The hair being split is, I have been told, that “if” here does not mean “it could be that” but “although it is not the case, for example that jump”.

I haven’t found anybody who does anything but laugh at that

So let me give Jason and Larry the mic: Jason Furman and Larry Summers: Susan Collins is wrong to say that the tax cuts will pay for themselves, despite the economists she cites: “Sen. Susan Collins… defended her vote on the Senate GOP tax bill…

…If you take the CBO’s formula and apply it, just four-tenths of one percent increase in the GDP generates revenues of a trillion dollars…. So I think if we can stimulate the economy, create more jobs, that does generate more revenue…

a claim that the tax bill will pay for itself…. Chuck Todd… challenged Collins to produce a study suggesting that tax cuts do not create larger deficit. The senator responded:

Well, talk to economists like Glenn Hubbard and Larry Lindsey and Douglas Holtz-Eakin, who used to be head of CBO, and they will tell you otherwise…

We believe it is very important for public understanding that Holtz-Eakin, Hubbard and Lindsey make their views on tax cuts paying for themselves clear. If they believe as we do, as all the members of a nonpartisan panel of distinguished economists assembled by the University of Chicago, as Holtz-Eakin asserted earlier this year, and Hubbard asserted some time ago, that tax cuts do not come close to paying for themselves, this seems essential to clarify…. It would be useful for any of them to clarify that the Republican-appointed Joint Committee on Taxation’s (JCT) modeling is nonpartisan, expert and superior to more partial and partisan analyses… [hat] the JCT’s estimate of less than a 0.08 percentage point additional annual growth rate increase is not inconsistent with the long-run output increases the authors claimed in their letter to Treasury Secretary Steven Mnuchin, as they clarified in their response to us.

Alternatively if Holtz-Eakin, Hubbard and Lindsey now believe that tax cuts will pay for themselves, we think it appropriate for them to provide a basis for this belief in light of the many issues we have raised about their letter to Mnuchin.

As I wrote: In universities—and thinktanks—concern for one’s academic reputation and the good opinion of colleagues in the context of a community that places the highest value on truth-seeking, truth-telling, and high-quality debate is supposed to keep such unprofessional behavior to a minimum.

Just before he was canned from Berkeley during the Red Scare, medieval history professor Ernst Kantorowicz argued that the academic robe worn by scholars on formal occasions was a sign of this dedication to truth-seeking, truth-telling, and high-quality debate: academics had placed themselves under a geas to think hard and say what they believed to be true, and that in carrying out this geas they were responsible to “their conscience and their God”.

But what if we find that there are large numbers of university professors and thinktank fellows who fear neither God nor their consciences—and who value the support of donors and the approval of partisans more than their internal academic reputations? The process of socialization and acculturation was supposed to keep such people out of universities and thinktanks, and in law and lobbying firms where it was understood that people were simply offering arguments rather than claiming to be setting forth truths, and from which their arguments could be assessed with boatloads of salt. What if this process fails?

Should-Read: Yingyi Qian: How Reform Worked in China: The Transition from Plan to Market: “A noted Chinese economist examines the mechanisms behind China’s economic reforms, arguing that universal principles and specific implementations are equally important…

…As China has transformed itself from a centrally planned economy to a market economy, economists have tried to understand and interpret the success of Chinese reform. As the Chinese economist Yingyi Qian explains, there are two schools of thought on Chinese reform: the “School of Universal Principles,” which ascribes China’s successful reform to the workings of the free market, and the “School of Chinese Characteristics,” which holds that China’s reform is successful precisely because it did not follow the economics of the market but instead relied on the government. In this book, Qian offers a third perspective, taking certain elements from each school of thought but emphasizing not why reform worked but how it did. Economics is a science, but economic reform is applied science and engineering. To a practitioner, it is more useful to find a feasible reform path than the theoretically best way.

…The key to understanding how reform has worked in China, Qian argues, is to consider the way reform designs respond to initial historical conditions and contemporary constraints. Qian examines the role of “transitional institutions”—not “best practice institutions” but “incentive-compatible institutions”—in Chinese reform; the dual-track approach to market liberalization; the ownership of firms, viewed both theoretically and empirically; government decentralization, offering and testing hypotheses about its link to local economic development; and the specific historical conditions of China’s regional-based central planning…

Should-Read: Austin Clemens and Heather Boushey: What if we took equity into account when measuring economic growth?: “The four measures shown in the graphs above could all be reasonable ways of thinking about measuring progress in the U.S. economy…

…Each requires making a value judgement about what kind of growth we value. This is no less true of GDP growth…. GDP growth can paint a very misleading picture of the health of the economy, suggesting that we are in a robust recovery when, in fact, only a small number of households are benefitting. Furman is right to suggest that this is a debate economists and policymakers should have. Unfortunately, the economic indicators reported by the U.S. Bureau of Economic Analysis do not provide sufficient detail to calculate, for example, the mean log of income…. The National Income and Product Accounts provide no distributional information at all. The task of decomposing growth by income quantile has fallen to academic economists. Until the BEA takes up the task of reporting distributional income totals, decisionmakers will continue to lean on GDP growth, and they will continue to be misled by it…

Should-Read: Peng Zhang et al.: Temperature Effects on Productivity and Factor Reallocation: Evidence from a Half Million Chinese Manufacturing Plants: “This paper uses detailed production data from a half million Chinese manufacturing plants over 1998-2007…

…to estimate the effects of temperature on firm-level total factor productivity (TFP), factor inputs, and output. We detect an inverted U-shaped relationship between temperature and TFP and show that it primarily drives the temperature-output effect. Both labor- and capital- intensive firms exhibit sensitivity to high temperatures. By mid 21st century, if no additional adaptation were to occur, we project that climate change will reduce Chinese manufacturing output annually by 12%, equivalent to a loss of $39.5 billion in 2007 dollars. This implies substantial local and global economic consequences as the Chinese manufacturing sector produces 32% of national GDP and supplies 12% of global exports…