All Things in Moderation

Sunday Links

5 Responses

1. 

   markinaustin, on October 8, 2012 at 7:28 am said:

   JNC, did you find Baumol’s cost theory persuasive? I did, as to elementary school education, particularly. Generally, it seems to comport with reality over time, to me.

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2. 

   novahockey, on October 8, 2012 at 7:49 am said:

   FWIW, the ACA instituted changes to clamp down on costs through a productivity adjustment to payment rates and a lot of the “savings” assumes they adjustments are implemented on schedule. I’m dubious. I think we’ve created a “doc fix” for everyone.

   Also — Baumol’s theory has been kicking around health care for years. This is from 2001

   http://www.ama-assn.org/amednews/2001/02/12/bica0212.htm

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3. 

   jnc4p, on October 8, 2012 at 8:40 am said:

   I found it to be a useful analysis of the current state of affairs, especially when thinking about the price of computer components or other consumer electronics relative to other goods.

   With regards to health care, it’s valid until we get automated holographic doctors:

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4. 

   jnc4p, on October 8, 2012 at 9:19 am said:

   “markinaustin, on October 8, 2012 at 7:28 am said:

   JNC, did you find Baumol’s cost theory persuasive? I did, as to elementary school education, particularly. Generally, it seems to comport with reality over time, to me.”

   Banned is slightly more dismissive in his comments on the same article on Ezra’s site:

   http://www.washingtonpost.com/blogs/ezra-klein/wp/2012/10/08/wonkbook-can-government-keep-up/

   Baumol may be wrong about healthcare & education cost drivers, but that doesn’t make Pearlstein a “hack”.

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5. 

   jnc4p, on October 8, 2012 at 9:29 am said:

   With regards to music performance:

   “No matter how innovative people were in coming up with new technology and new ways of organizing their work, Baumol and Bowen reasoned, it would still take a pianist the same 23 minutes to play a Mozart sonata, a barber 20 minutes to cut the hair of the average customer and a first-grade teacher 12 minutes to read her class “Green Eggs and Ham.” Based on this observation, the duo predicted that the cost of education and health care would inevitably outstrip the price of almost everything else.”

   it’s worth noting Mick Jagger’s take on this:

   “Things have obviously changed a great deal since those sessions. What’s your feeling on technology and music?

   Technology and music have been together since the beginning of recording.

   I’m talking about the internet.

   But that’s just one facet of the technology of music. Music has been aligned with technology for a long time. The model of records and record selling is a very complex subject and quite boring, to be honest.

   But your view is valid because you have a huge catalogue, which is worth a lot of money, and you’ve been in the business a long time, so you have perspective.

   Well, it’s all changed in the last couple of years. We’ve gone through a period where everyone downloaded everything for nothing and we’ve gone into a grey period it’s much easier to pay for things – assuming you’ve got any money.

   Are you quite relaxed about it?

   I am quite relaxed about it. But, you know, it is a massive change and it does alter the fact that people don’t make as much money out of records.

   But I have a take on that – people only made money out of records for a very, very small time. When The Rolling Stones started out, we didn’t make any money out of records because record companies wouldn’t pay you! They didn’t pay anyone!

   Then, there was a small period from 1970 to 1997, where people did get paid, and they got paid very handsomely and everyone made money. But now that period has gone.

   So if you look at the history of recorded music from 1900 to now, there was a 25 year period where artists did very well, but the rest of the time they didn’t.”

   http://news.bbc.co.uk/2/hi/entertainment/8681410.stm

   Under this view, artists got paid based a specific tying of music to a physical distribution system, i.e. records, and then technology revolutionized that. Also, the price of artist tickets isn’t based on work effort, but rather scarcity.

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