Tyler Cowen on Economic Turbulence
By Arnold Kling
Economists Clair Brown, John Haltiwanger and Julia Lane…note [that] job turnover and firm disappearance have positive effects, in the aggregate…As workers lose jobs in one niche or sector, they gain in another, moving on to better jobs and higher pay.
As usual, he has many interesting things to say about the state of American workers. And as usual, I have a quibble. He writes,
measured value of benefits has risen in lieu of real wage increases, because of more expensive health-care premiums. People are paying more for insurance without getting better treatment.
Most people will read this as saying that the health insurance companies have become an economic sinkhole, and that is where all of the money is going. If that is what Tyler intends to say, then I disagree. I think that the sinkhole, such as it is, is the increased usage of specialists and high-tech medicine for services that have very little average benefit.