The latest medical fact with "obvious" policy implications comes from the Journal Health Affairs, in their article MarketWatch: Illness and Injury As Contributors to Bankruptcy. Paul Krugman wrote in Tuesday's NY Times that it showed "more than half of bankruptcies are the result of medical emergencies. The rest are overwhelmingly the result either of job loss or of divorce." Reuters quotes one of the authors stating that "Unless you're Bill Gates you're just one serious illness away from bankruptcy,"
Survey data are always very suspect, which is why economists generally do not use them. Visa's Annual Bankruptcy Debtor Survey from 1997 pegged Medical expenses as explaining only 15% of bankruptcies. Gallup did a survey in 1997 and estimated medical at 28%, higher than Visa, but half of what the latest study estimates. I would say that the standard error on surveys (52%, 28%, 15%), is reflective of their general vacuousness.
One great example of survey data confounding observation is hunger in America. Survey data is the primary reason some people believe there is significant systematic hunger in America, despite the fact that obesity is a greater problem among the poor. Even the Center on Hunger and Poverty, which has a vested interest in finding hunger, notes that while the poor are prone to be more obese, they reconcile this by noting that increases in risk of hunger increase the likelihood of poor food choices. Uh huh. 36.2 million Americans were considered "Food Insecure" (as surveyed by the USDA--another party with a vested interest in finding hunger), which means that in a survey, respondents stated that access to nutritionally adequate and safe foods is either limited or uncertain, or the ability to obtain foods occurs in socially unacceptable ways. So if you ask the poor, they are uncertain as to what their next meal will be, as I assume most people are, which is then translated by helpful hunger do-gooders into "one day away from starvation", though in practice these same people are obese. The fact that there have been no exposes showing pockets of America where children have ribs protruding is also a big datapoint, in that most journalists would love to break that story; if it existed, we would see it. It does not exist.
So it is really no surprise that a survey would find most bankruptcy causes totally orthogonal to personal vices. The tendentious nature of this study is reflected by how they classify personal vices like gambling or drug addiction as a medical cause, just to make certain their result would appear (as if you would catch these afflictions like the flu). As Wittengenstein said, sometimes you are not measuring with the ruler, you are measuring the ruler itself, in this case the ruler is the vague and loaded question. Clearly if a stranger asks you if your sorry financial condition is due to 1) your poor judgement or 2) something else, most people opt for #2.
But most importantly, the quality of this research is seen clearly in its references. Nowhere do they note other survey data, such as that by Gallup or Visa. Nowhere do they mention Domowitz and Sartain's 1999 Journal of Finance article on Determinants of the Consumer Bankruptcy Decision. They do reference the following unbiased sources: The Two-Income Trap, In Critical Condition: The Crisis in America’s Health Care, and The Affordability Crisis in U.S. Health Care.
Finally, good research should always ask, what empirical findings would this not explain? For example, the most conspicuous datapoint in consumer bankruptcy over the past 25 years was the big increase in the mid 1990's. Clearly something major happened that caused bankruptcies to increase about 60% in a non-recession period. Medical expenses were not rising sharply, but credit card solicitations did rise dramatically. It seems as if credit card availability, and thus overextension, is a major, if not the major main bankruptcy culprit.
In sum, I don't think I've ever seen sociology research by doctors that wasn't shoddy and incomplete, but never in doubt as to its policy implications.
Survey data are always very suspect, which is why economists generally do not use them. Visa's Annual Bankruptcy Debtor Survey from 1997 pegged Medical expenses as explaining only 15% of bankruptcies. Gallup did a survey in 1997 and estimated medical at 28%, higher than Visa, but half of what the latest study estimates. I would say that the standard error on surveys (52%, 28%, 15%), is reflective of their general vacuousness.
One great example of survey data confounding observation is hunger in America. Survey data is the primary reason some people believe there is significant systematic hunger in America, despite the fact that obesity is a greater problem among the poor. Even the Center on Hunger and Poverty, which has a vested interest in finding hunger, notes that while the poor are prone to be more obese, they reconcile this by noting that increases in risk of hunger increase the likelihood of poor food choices. Uh huh. 36.2 million Americans were considered "Food Insecure" (as surveyed by the USDA--another party with a vested interest in finding hunger), which means that in a survey, respondents stated that access to nutritionally adequate and safe foods is either limited or uncertain, or the ability to obtain foods occurs in socially unacceptable ways. So if you ask the poor, they are uncertain as to what their next meal will be, as I assume most people are, which is then translated by helpful hunger do-gooders into "one day away from starvation", though in practice these same people are obese. The fact that there have been no exposes showing pockets of America where children have ribs protruding is also a big datapoint, in that most journalists would love to break that story; if it existed, we would see it. It does not exist.
So it is really no surprise that a survey would find most bankruptcy causes totally orthogonal to personal vices. The tendentious nature of this study is reflected by how they classify personal vices like gambling or drug addiction as a medical cause, just to make certain their result would appear (as if you would catch these afflictions like the flu). As Wittengenstein said, sometimes you are not measuring with the ruler, you are measuring the ruler itself, in this case the ruler is the vague and loaded question. Clearly if a stranger asks you if your sorry financial condition is due to 1) your poor judgement or 2) something else, most people opt for #2.
But most importantly, the quality of this research is seen clearly in its references. Nowhere do they note other survey data, such as that by Gallup or Visa. Nowhere do they mention Domowitz and Sartain's 1999 Journal of Finance article on Determinants of the Consumer Bankruptcy Decision. They do reference the following unbiased sources: The Two-Income Trap, In Critical Condition: The Crisis in America’s Health Care, and The Affordability Crisis in U.S. Health Care.
Finally, good research should always ask, what empirical findings would this not explain? For example, the most conspicuous datapoint in consumer bankruptcy over the past 25 years was the big increase in the mid 1990's. Clearly something major happened that caused bankruptcies to increase about 60% in a non-recession period. Medical expenses were not rising sharply, but credit card solicitations did rise dramatically. It seems as if credit card availability, and thus overextension, is a major, if not the major main bankruptcy culprit.
In sum, I don't think I've ever seen sociology research by doctors that wasn't shoddy and incomplete, but never in doubt as to its policy implications.
HedgeFundGuy - am 2005-03-08 20:18 - Rubrik: economics
