> Most of the harm of unemployment is psychological, not material. Holding income constant, the employed are much happier than the unemployed.
This doesn't factor in that employed workers might be much happier in countries where they can work without the possibility of being fired at any moment for no reason hanging over their heads.
If you can correctly predict economic developments for 10 years on a world scale, I think you'd be entitled to sound a little smug too. I've read a lot of economists much more smug that utterly failed to predict something right under their noses, and still are regarded as respected and asked for more prediction. I'd rather take one that can predict stuff, smug or not.
That reminds me of a joke - what's the probability of meeting of a dinosaur in the street? 50% - either I meet him, or I don't!
Not every event with two outcomes is 50/50, you know :) And the article does point to both the subject of the bet - unemployment indexes, which are known to all participants and it's kinda the job of the economist to know what they mean - and why Caplan thought he would win. It may be, of course, that he won randomly and his theory is still wrong - but in general people that successfully predict real world outcomes are regarded better in most scientific endeavors than people that predict wrongly.
They aren't all independent 50/50 bets. There are a few clear trends in the wagers (bullish on the US economy, Eurozone/EU will not completely go to shit), so predicting just a few trends correctly wins most of the bets (though being wrong on those same things would lose most bets) and there are some bets at very long odds (e.g. 200:1 odds on Ron Paul becoming president) so even the person on the other side of the bet doesn't think it's a likely outcome.
He includes a link to data connecting unemployment to unhappiness.
His so-called smugness derives from betting: putting his ideas on the line and winning. I think he's the opposite of smug because he's humble enough to put his ideas to the test. Maybe he gloats, but I think we should socially encourage victors gloating (in fair competitions).
What did he test though? That over a given decade, unemployment might be higher in one nation-state than a collection of others?
What's the hypothesis? Where's the valuable data gotten from this?
My idea of equivalent action: Me stating "the president 10 years from now will be the first 3rd party president ever."
Why? Who knows! And if I was right, and make a blog post that says "See, I was right!" And then point to a bunch of things that happened after my prediction that led to this result, what did we learn? Anything at all?
The point is that these are bets between people who disagree with each other. They negotiate the data and terms and hopefully learn from the result and change their minds. This is one way to help tune bayesian priors about what ideas and people to trust and investigate further.
This is an economist betting that higher regulation causes higher unemployment, and winning. That's a useful step better than simply stating the opinion. It's much worse than a randomize controlled trial, and it would be delightful if the European Union could be convinced to carry those out for science. But employees and employers tend to object to being experimented on.
Well it's effectively free if you're life-long unemployed.
But almost more importantly, the healthcare isn't being delivered by companies trying to make a profit but from central funding instead. Sometimes that means making really difficult decisions such as NICE refusing to fund a cystic fibrosis drug because the US pharmaceutical company wants to charge $138,000[1] per patient per year.
But those difficult decisions mean the limited funding (and no funding can be infinite) can be targeted and spent to deliver the most benefit as a whole. Heart-breaking for those with children with C.F. but hopefully the U.S. drug company will soon back down. If it weren't for brexit they likely would have done so already.
One of the most important reasons to resist the privatisation of healthcare is because it would actually lead to worse outcomes for the same money spent as the decisions of where to direct funding would be less evidence based.
You're right, it's not free, and in fact needs more investment to prevent it being privatised. Britons spend less on healthcare than most, even in fact spending less per person than the US does through taxation alone[2].
Denmark? Probably the weakest hiring/firing laws in the developed world (in terms of employee protection) and, last I checked, one of the happiest countries in the world.
Which is exactly my point. The post I am replying to said:
> workers might be much happier in countries where they can work without the possibility of being fired at any moment
The reason why this is an issue is nothing to do with actually being fired, it is due to the difficulty of getting rehired...which is a bigger issue if labour markets don't function (and in most European nations, as the higher unemployment has risen, the more desperately the privileged few have clung onto their protections worsening the issue).
This is why Denmark went the other way: the logic for inflexible labour markets is only consistent when labour markets are not flexible. Remove that and target spending where it is actually needed i.e. on meeting the needs of the market.
The idea of stronger safety nets is also not particularly true (the idea of strong/weak never made sense to me). Social security is not universal as in the UK or US, it is based on contributions. And the reasons unions work, again in contrast particularly with the UK, is that they collaborate with employers (Denmark's union participation rate is anomalous but even compared with somewhere like Germany).
> Most of the harm of unemployment is psychological, not material. Holding income constant, the employed are much happier than the unemployed.
This doesn't factor in that employed workers might be much happier in countries where they can work without the possibility of being fired at any moment for no reason hanging over their heads.