Obamacare, this week's name of the game

Obamacare, or the triumph of Obama/Democrat's health reform bill in the House is the name of the game this week. (Especially after Liverpool's loss to MU).

The whole process is interesting to follow. Not for its 'heroic' moment for Democrats. Not for the contents, which I am still learning about. Well, I like that there is finally an attempt to fix the problems in the US health care, including the market failures associated with it. But, like Greg Mankiw wrote, we still need to understand the trade-offs of each policy choice.

For professional purpose, I have been trying to follow the issue, read here and here. Oh, by the way, the blog is my new playground -- a nerdier version than this Cafe.

I was entertained by how the politics are played in Washington. Not because it's beautiful. On the contrary, we've seen the good, bad and ugly side of Washington politics. Where ideas, idealism and ideology meet pragmatism, negotiations and bargaining.

Also on what I considered as 'the cattenaccio of politics' played by Obama. He distanced himself from the micromanagement, orchestrating the Democrats in both chambers of Congress to get bogged down with the nitty-gritty details. When Mass. senate seat went to Republican Scott Brown, eliminating Democrat's supermajority, they changed the tactics. House voted for an earlier Senate version, so they don't need another round of vote from the Senate. Big kudos to Nancy Pelosi who led a successful army of arm-twisting, nail-pulling efforts, making sure the bill was passed.

Now, compare that to the Pansus drama...

Sure, some friends argued it was all about ideology. It was the triumph of government over market and big corporations. Well, fine if you think that way. But for all the pro-government enthusiasts, two things are missing from Obamacare: a government-run commercial insurance and single-payer system.

Ah, and of course some DPR members failed to get the story right. This guy screamed Obama's Asia-Australia trip delay was a sign of diplomatic failure. Our government (SBY, that is), failed to convince the US that Indonesia is safe. Well, what can we expect?

To Fast or Not To Fast

When Sisil was pregnant with Lintar, we decided that she skipped fasting during Ramadan. Our common sense says that it'd be healthier for the baby if the mother doesn't fast --and pay the financial compensation to the poor instead. But apparently, as seen from our friends' wall status at Facebook, our thinking differs from many who prefer to keep fasting during pregnancy.

Recently I come across two papers on pregnancy and subsequent offspring's health status. One is from Douglas Almond on the long term impact of in utero 1918 influenza pandemic in the US (JPE, 2006, vol. 114. no. 4); the other is from Reyn Van Ewijk (LSE's CEP working paper, 2009) on the long term health impact on the next generation whose mothers were fasting during pregnancy.

It seems that our common sense is vindicated. Van Ewijk writes:

Using Indonesian cross-sectional data, I show that people who were exposed to Ramadan fasting during their mother’s pregnancy have a poorer general health and are sick more often than people who were not exposed. This effect is especially pronounced among older people, who, when exposed, also report health problems more often that are indicative of coronary heart problems and type 2 diabetes. The exposed are a bit smaller in body size and weigh less.

We are aware that religious interpretation is a very personal affair, yet we still keep wondering what is the selfish true reason for insisting on fasting during pregnancy despite the available exemption option.

Why Culture Matters

After being scolded by the baristas for doing a crappy job, the Manager dug up her emails to recover the yet-to-be-posted article submitted by one of our favorite guest hosts, Roby. You see, Roby complained that his submission about “toilets and culture” was never posted here on the Café with nary an acknowledgment from the management, which shows just constipated (sorry, can’t help it) our “review” process is (hint: it involves email forwarding and little else).

The Manager finally found the said submission, originally received by the Café in December 2007. The only problem is, instead of “toilets and culture” the post was more about “table manners and culture”. There may be confusion between things that are going in one end and going out the other end, that’s understandable (happens to the Manager all the time). In any case, the post is indeed very relevant to A.P.’s toilet contribution. So here it is, without further ado, an excellent rejoinder.

- Kate, the remorseful Manager

Why Culture Matters

by Roby

It is common to put culture and the concept of economic man in a diametrical term. Taking the risk of oversimplification, the debate can be summarized as follow. The cultural argument argues that people behaviors are largely determined by cultural scripts, not by rational cost-benefit calculations. On the other hand, economic argument insists that individual decisions are independent of cultural factors.

Here I would like to argue that the picture of economic men is still plausible in cultural analysis and culture is a necessary prerequisite for rational calculations.

The key here is to see culture as a toolbox. That is as a set of tools that are accessible for solving problems. People face problems in their daily lives and use whatever they have in their toolboxes to solve the problems. Once they have picked a tool, they can use it in a highly rational way. This rational calculation, however, is only possible when a person has chosen a tool.

For example, imagine a group of people who use their hands when they are eating and another group who use utensils. Now because of health concern, we want to make those who use their hands to switch to use spoons and forks. Economists tend to jump to the conclusion that the whole problem can be solved by finding the right incentive. As they soon found out, however, the former group did not switch even though they completely understood the health benefit of using spoons and forks.

The problem here is that the first group does not consider spoons and forks as eating tools. For them, eating using spoons and forks is as absurd as, say, eating bugs. They just don't do that - despite the fact that bugs have nutritional values. Therefore, persuasion, bargaining, socialization and inspiration can be as much useful as incentive.

If we see culture as tools, then the rational calculation only applicable to available tools. We cannot perform cost-benefit analysis on the tools that are not part of ones' toolbox. Therefore rationality is local instead of global. It is in this sense culture matters for economic analysis. On the other hand, cultural analysis would benefit by applying rational choice to understand behavior in a given context.

Of toilets, faeces and open defecation

Yes, I've been absence for a while from this cafe. Unlike Sjamsu, I haven't been performing in The Police and Queen nights. Unlike Aco, I haven't been winning any awards. Unlike Ujang, I was happy that Liverpool has beaten MU and Chelsea.

I have been traveling recently to some places, mainly to East Java, for a rural sanitation project in eight kabupatens. I visited some villages, and in many villages I found that only 1 every 9 or 10 households that have in-house toilets. They do most of their business in the river or bushes. Of course, it is easy to think the relations between open defecation, health problems, human capital, and productivity. We may also hypothesize that poverty is the reason why they don't have in-house toilets.

However, most of them have brick or concrete houses, sometimes with ceramic floors. And almost every household have at least one cell phone. So cost (supply) can not be the constraint -- demand looks to be a bigger problem. This may be due to 'culture-related' sanitation behavior, lack of awareness, or whatever reason. The point is, if you just simply build public toilets or subsidize people to build one in their house, such intervention may not work. People will just go back to the river or bushes.

This is where I agree to our friends Tirta (and Roby, among others), that psychology and understanding the nature of social interaction is important. In fact, the project in which I am involved aims to create demand for proper sanitation. What we do is, open community meeting, we ask the villagers to: 1) draw their local map, 2) ask them to identify which houses have toilets, and where do the rest go for defecating, 3) invite them to do some mental exercise in counting how much faeces they are producing in a day, week, month and in a year. After that, we ask them who wants to build toilets equipped with septic tank.

If 1-3 don't work, we then ask them to go to the spots where the villagers do their usual business. If this also don't work, the strategy is to take real, fresh, faeces in front of them then discuss the possible transmission of virus and bacteria to human's body. (Well, if this also doesn't work, then, from the perspective of the project, we're in a deep shit...).

Of course, this efforts may or may not work. Despite all the campaigns, maybe only a few people want to build toilets in the end. Even though many people build their own toilets, their health situation may not improve. This is why we are doing an impact evaluation (in fact, I am involved in the evaluation side of the project, not the shitty activities one). After collecting the baseline data, in a few months up to a two-year period, we will be collecting some data on the health status. Then we will compare the data in the 'treated' and 'control' villages. We'll see the result in 18 months...

Why (Not) I?

Aco could proudly claim that he's ahead of me by (dreaming) to write a novel about economics and politicians. But these guys, Ray Fisman of Columbia and Edward Miguel of Berkeley, seem (way) ahead both of us. They are about to publish a story (or stories) on how economics (with data) can reveal how the gangster's (read: dirty diplomats, politicians, dictators, bureaucrats) minds works. The title is Economic Gangsters: Corruption, Violence and the Poverty of Nations.

And more embarrassingly, they even devote a whole chapter on Soeharto --the man the two of us should know better.

Another embarassment comes from Elisabeth Pisani, who wrote about Taman Lawang and Lapangan Banteng --a book that now is recommended by Marginal Revolution. The title is The Wisdom of Whores: Bureaucrats, Brothels, and the Business of AIDS

Here's some excerpt:

Lenny, another doyenne of the city’s transgender hookers who was putting on her make-up while Nancy pontificated, laughed. Lenny is not thrilled that the Department of Social Affairs has tossed her, along with all waria, into a box marked “mentally disabled”. But she had to agree with “over the top”. Lenny had organised a group that was lobbying for equal rights for waria. She interrupted her face-paint rituals to tell of a recent meeting with a parliamentary sub-committee. “We’re in the national parliament asking to be taken seriously as a community, and I see that two of the girls are missing. I send someone off to look for them and guess what? They’re screwing the security guards in the bathroom.” She shook her head in disbelief and went back to her mascara.

I've ordered my copy. The book seems terribly fascinating --and more importantly, because it makes me enviously feel: "it should have been I who write books about those interesting things just under my nose with that kind of style". Oh, well.

Spit and Blood

...and Other Bodily Fluids We Want from You

While Aco and Anna were being amused in Japan, my middle finger was being pricked for blood by a research psychiatrist whose main field of research include depression and social dysfunction...

We often say that economists are not too interested in learning what people say or what people feel. We are more interested in observing what choices people actually made - revealed preference is an example of this approach. How much then, do you think, one should value the answer to the question "Are you very happy, pretty happy, or not very happy" in surveys? Not very much, if you're an economist. You'd want to be able to observe things that show people really are happy, some objective measures.^*)

The similar is true when we want to study health status of individuals. Self-reported measures of health status (e.g. "How would you rate your overall health?"), while valuable, are subjective, prone to error, and often misreported. So we would look for "hard" evidence in the form of objective health measures to complement the self-reported measures. Robert Fogel, in one of his famous studies, look at long-term trend in height of individuals to study health, nutrition, and economic growth. There is now a large literature in economics that utilizes anthropometric data such as height and weight in various forms (Body Mass Index, weight-for-height Z-scores, waist circumference, etc.).

In recent years, economists as well as other social scientists have looked at other sources of "hard evidence": saliva, blood drops, urine, and practically any other bodily fluids they can have their hands on. These are of course some of the things that people in biology, medicine, and epidemiology have been studying in their respective fields. But several development have transformed activities that previously could only be conducted in a laboratory setting in such ways that they can now be done in the context of large scale population-based research.

First, the cost of doing so has never been cheaper. Equipment to measure blood pressure, blood hemoglobin level, cholesterol levels, are becoming smaller and cheaper. Methods to analyze blood sample from a dried drop of blood have been developed - no need to collect a whole tube- enabling researchers to incorporate blood sample collection into their large scale surveys. Second, researchers are realizing that so long as they follow strict ethical guidelines, people are willing to provide blood, urine, or saliva.**) In contrast, people are more guarded about their earnings, savings, or wealth. And this is true not only in developing countries but also in developed countries: people are generally more willing to spit for you than they are in telling you how much money they make last year.

Third, scientists have been able identify some biomarkers that can be linked to various health and behavioral outcomes. For example, the level of cortisol, a hormone that is released by our body in response to stress, could be useful for those who are interested in learning how negative events influence one's health. Asking "Are you stressed out?" could be useful too, but having objective measure as well would certainly be better. We can obtain cortisol levels by analyzing saliva (preferably collected at different times of day, because of its diurnal variation). C-reactive protein, a protein that is released during inflammatory episodes can be measured from a small spot of dried blood. There is now a body of evidence linking C-reactive protein levels with elevated risk of hypertension, cardiovascular disease, and diabetes. In this Cafe a while ago, Aco mentioned an economic paper that looks at cotinine level in blood. By collecting these objective measures of health, social scientists now have better access to study the relationship between health and socioeconomic status and the two-way nature of the relationship.

So there I was, my middle finger being pricked for blood by this research psychiatrist whose main field of research include depression and social dysfunction..

We were both eager participants of a workshop designed to equip social scientists with tools on how to integrate biomarkers into our research. There were psychiatrists, psychologists, demographers, sociologists, economists, and anthropologists in the room (note: some biological anthropologists are at the frontier of this interdisciplinary research) .

Part of the fun -besides exchanging bodily fluids- is to learn about the new terminologies and compare them to things we have in our own discipline. Take homeostasis, for example, the property of our bodies to internally maintain a stable condition regardless of changes in outside environment. Example: our body has a "thermostat" that regulates internal temperature that keeps our body from becoming too hot - we sweat. Economists would perhaps associate homeostasis with a steady state equilibrium. And there's allostasis, the process of maintaining stability or homeostasis through changes in physiological or behavior. Example: having endured prolonged exposure to heat, we will not only be sweating, but our kidneys will start to reduce urine output, eyes begin to dry out and so forth. Economists: think of allostasis is the process of moving from an old to a new equilibrium level, if there are multiple equilibria. And the fun goes on.

A look back at older posts and comments in this Cafe would reveal that many of the Cafe's visitors (Tirta, Roby, just to name a few) are already well-versed in inter-disciplinary crossovers. I, dear readers, still have a lot to learn.

*) There is of course a strand of literature in economics that increasingly take subjective measures of well-being seriously. See, for example, the paper by Kahnenman and Krueger in the Journal of Economic Perspectives, 2006 (20:1) on the topic. And yes, I know about Bhutan's Gross National Happiness project.
**) The ethical part of this body of research is something that cannot be taken for granted. Just last week, there was an article in the New York Times about a group of Amazon Indians who were aggrieved when they found out (from the internet!) that blood samples that were collected from them years ago are now being sold to researchers around the world.

Worms, wax, and test scores

How do we improve a country's (or region, community) education level?

From the research perspective, the first question to ask is 'what do we mean by education level?' Normally we use school enrollment rate to see how much is the share of population of a specific school age are enrolled in schools. Alternatively, we can use average test scores for quality measurement. There are many other measurements, depends on what do we want to see, but those two are the most common.

The next question is on what policy (intervention) to take. Is 'increase education budget' is the answer? Well, money is always nice, for sure. But what will the money for? To build more schools, to pay teachers, to provide scholarships? If someone do the counts of what appear in newspapers, these things are probably mentioned the most. The problem is, these interventions assume that the problems with education lies on the supply side, and budget is the biggest constraints.

However, this may not necessarily be so. Maybe school enrollment is low because, well, people don't see the point of going to school. Maybe test scores are low because students don't come to school for any reasons. Or, they do come to school but not for studying (i.e. beating their fellow students, like these guys).

Or, they do come to school but can not understand what the teacher says because of some other reasons. One possible reason is: incestinal worms. This is what Eduard Miguel and Michael Kremer found in Kenya. Worms infected billions of children around the world, and the problem is the most serious in Africa. When you are infected with worms, you share your nutrition with them, affecting your ability to grasp materials. Or worse, periodically you would have to be absent from school because of certain disease caused by worms. According to Miguel and Kremer, deworming program proves to be effective in increasing school attendance rate and raising test scores with lower cost than other types of intervention (like subsidizing school uniforms).

That was in Kenya. There is a similarly interesting story from Kepanjen Subdistrict, Malang, East Java. A local doctor found that attendance rate was not a problem there, but performance was. Later he found that, among other things, performance of students was affected by... earwax. Well, you know the channel. No rigorous studies have been done, but headmasters reported that regular de-waxing program increased average test scores.

Apparently, small things can lead to big changes.