Economists specialize in pointing out unpleasant trade-offs - a skill that is on full display in the health care debate. We want patients to receive the best care available. We also want consumers to pay less. And we don't want to bankrupt the government or private insurers. Something must give.
Interpretation
The quote highlights the difficult trade-offs in the healthcare debate between quality care, affordability, and financial sustainability.
Sendhil Mullainathan emphasizes the complex trade-offs in healthcare, illustrating the challenges of providing high-quality care while keeping costs manageable for consumers and avoiding financial strain on government and private insurers. This quote invites critical thinking about the competing interests in economic policies and the inevitable compromises that must be made.
In practice
During a seminar on health policy, this quote could be used to illustrate the challenges decision-makers face.
Faced with a time shortage, we squeeze tasks into the nooks and crannies of our calendar, leaving less and less time to switch between them. As a result, we become less and less productive exactly when we need to be most productive.
The problem with data is that it says a lot, but it also says nothing. 'Big data' is terrific, but it's usually thin. To understand why something is happening, we have to engage in both forensics and guess work.
There's a popular image of people who don't save for the future as lacking in self-control. But the reason saving is so hard has less to do with self-control and more to do with a scarcity of attention.
January is always a good month for behavioral economics: Few things illustrate self-control as vividly as New Year's resolutions. February is even better, though, because it lets us study why so many of those resolutions are broken.
Busy people all make the same mistake: they assume they are short on time, which of course, they are. But time is not their only scarce resource. They are also short on bandwidth. By bandwidth I mean basic cognitive resources - psychologists call them working memory and executive control - that we use in nearly every activity.
The true law of economics is chance, and we learned people arbitrarily seize on a few moments and establish them as laws.
An economy hampered by restrictive tax rates will never produce enough jobs or enough profits
We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.
I attempted to see famines as broad "economic" problems (concentrating on how people can buy food, or otherwise get entitled to it), rather than in terms of the grossly undifferentiated picture of aggregate food supply for the economy as a whole.
Passive commerce . . . should thus . . . [compel us] to content ourselves with the first price of our commodities, and to see the profits of our trade snatched from us, to enrich our enemies and persecutors. That unequalled spirit of enterprise . . . an inexhaustible mine of national wealth, would be stifled and lost; and poverty and disgrace would overspread a country, which, with wisdom, might make herself the admiration and envy of the world.
We must lay hold of the fact that economic laws are not made by nature. They are made by human beings.
Subscribe for the occasional hand-picked quote. No noise.