from Questions Previous Final Exam 1. A seemingly constant topic of conversation in this country is how to decrease the number who are uninsured. Interpret why a substantial portion of the population remain uninsured making use of your knowledge of what underlies the demand for insurance, current government policies to encourage (or supply) coverage, and the imperfections that influence this market. (Limit yourself to health insurance and exclude long term care.) (Also exclude those 65 and older.) Given your analysis, can you offer one suggestion to improve the market and discuss how you expect it to work to improve the proportion without coverage. 2. All payers of health care seem to be struggling with increasing costs. What is the evidence on whether or not costs are increasing substantially? Discuss at least three approaches that might be successful in reducing medical care costs keeping in mind what you learned about provider behavior and the structure of the medical care market. Be sure to develop an economic argument behind your suggestions. Lastly, based on your understanding of the medical care markets, what suggestion would you make for reducing costs if you were asked by the incoming governor. 3. The New York Times reported on December 2, 2002:
Researchers say increased cell phone use has led to more crashes caused by drivers on the phone, but the value people on place being able to call from the road roughly equals the accidents' cost.... Joshua Cohen, lead author of the study, said an individual has a small risk of being in an accident caused by a driver who is talking on the phone, but an overall public health issue exists nonetheless. At the same time, he urged careful consideration when deciding whether to ban cell phone usage.
Provide a sketch as to how one might evaluate the benefits and costs of a ban on using handheld cell phones while driving. In your answer, please pay some attention to whether the so-called Peltzman hypothesis (unintended consequences of regulation) may be an important consideration in such an evaluation. 4. Excise taxes are often advanced as policy interventions that can provide effective disincentives for individuals to undertake unhealthy beha...