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Category: Economics

Published October 21, 2011

Health Insurance: Learning from Emerging Economies

Perhaps surprisingly, the most interesting incentives have been developed in an emerging economy: South Africa. The Discovery group, based in Johannesburg, has crafted a programme called Vitality that applies the “air miles” model to health care. You earn points by exercising, buying healthy food or hitting certain targets. You rise through various levels, from blue to gold, as you accumulate points (rewards are adjusted to your starting level of fitness to give everybody a chance of making progress). And you are given a mixture of short- and long-term rewards ranging from reduced premiums to exotic holidays.

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Published October 18, 2011

Farm Subsidies: “Plus ça change…”

Great article on farm subsidies on the front page of the New York Times this morning:

It seems a rare act of civic sacrifice: in the name of deficit reduction, lawmakers from both parties are calling for the end of a longstanding agricultural subsidy that puts about $5 billion a year in the pockets of their farmer constituents. Even major farm groups are accepting the move, saying that with farmers poised to reap bumper profits, they must do their part.

But in the same breath, the lawmakers and their farm lobby allies are seeking to send most of that money — under a new name — straight back to the same farmers, with most of the benefits going to large farms that grow commodity crops like corn, soybeans, wheat and cotton. In essence, lawmakers would replace one subsidy with a new one.

Surprise, surprise. Like my NC State colleague Mike Roberts wrote in a post last week:

These subsidies have been tough to justify for a very long time now.  Today’s budget pressure just might be able to break them.  But don’t hold your breath.  These subsidies have been around since the Great Depression and while they’ve gently declined over time in importance, they’ve been tough to kill.

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Published October 17, 2011

The FAO’s “State of Food Insecurity in the World”: A Study in Regulatory Capture?

Last week, the Food and Agriculture Organization (FAO) of the United Nations released its much-ballyhooed State of Food Insecurity in the World 2011 (SOFI). If you don’t have time to read all 55 pages of the SOFI, you can find the executive summary here, but be forewarned that the link opens a .pdf document.

In honor of World Food Day 2011, and given my interest in food policy as it relates to developing countries, I wanted to spend some time discussing the SOFI’s conclusions.

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