Question A:
Clearing the market for surgical face masks using prices is detrimental to the public good.
Responses
Responses weighted by each expert's confidence
Question B:
Laws to prevent high prices for essential goods in short supply in a crisis would raise social welfare.
Responses
Responses weighted by each expert's confidence
Question C:
Governments should buy essential medical supplies at what would have been the market price and redistribute according to need rather than ability to pay.
Responses
Responses weighted by each expert's confidence
Question A Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
|---|---|---|---|---|
 Daron Acemoglu |
MIT | Bio/Vote History | ||
|
Market signals are important. But in crisis, public solidarity is critical. Allocating vital equipment to the rich rich would destroy it.
|
||||
 Joseph Altonji |
Yale | Bio/Vote History | ||
|
|
||||
 Alan Auerbach |
Berkeley | Bio/Vote History | ||
|
|
||||
 David Autor |
MIT | Bio/Vote History | ||
|
Medical providers have highest social value of these supplies, not clear that they highest willingness/ability to pay
|
||||
 Katherine Baicker |
University of Chicago | Did Not Answer | Bio/Vote History | |
|
|
||||
 Abhijit Banerjee |
MIT | Bio/Vote History | ||
|
|
||||
 Marianne Bertrand |
Chicago | Bio/Vote History | ||
|
|
||||
 Markus Brunnermeier |
Princeton | Bio/Vote History | ||
|
The optimal policy depends on the supply elasticity. If supply cannot react, then high prices only generate additional rents.
|
||||
 Raj Chetty |
Harvard | Did Not Answer | Bio/Vote History | |
|
|
||||
 Judith Chevalier |
Yale | Did Not Answer | Bio/Vote History | |
|
|
||||
 David Cutler |
Harvard | Bio/Vote History | ||
|
During a pandemic is a different answer than in normal times.
|
||||
 Angus Deaton |
Princeton | Bio/Vote History | ||
|
|
||||
 Darrell Duffie |
Stanford | Bio/Vote History | ||
|
Uncertain. A market does not rule out government purchase and reallocation to critical users.
|
||||
 Aaron Edlin |
Berkeley | Did Not Answer | Bio/Vote History | |
|
|
||||
 Barry Eichengreen |
Berkeley | Bio/Vote History | ||
|
Wearing a mask has external effects. Denying masks to bus drivers on price grounds affects not just the driver but the passengers.
|
||||
 Liran Einav |
Stanford | Bio/Vote History | ||
|
|
||||
 Ray Fair |
Yale | Bio/Vote History | ||
|
There are externalities.
|
||||
 Amy Finkelstein |
MIT | Bio/Vote History | ||
|
|
||||
 Pinelopi Goldberg |
Yale | Bio/Vote History | ||
|
|
||||
 Austan Goolsbee |
Chicago | Bio/Vote History | ||
|
|
||||
 Michael Greenstone |
University of Chicago | Did Not Answer | Bio/Vote History | |
|
|
||||
 Robert Hall |
Stanford | Bio/Vote History | ||
|
Depends on the alternative distribution system
|
||||
 Oliver Hart |
Harvard | Bio/Vote History | ||
|
I assume we mean in a crisis where there is a shortage and supply is inelastic. Letting prices clear the market would cause huge anger.
|
||||
 Bengt Holmström |
MIT | Bio/Vote History | ||
|
|
||||
 Caroline Hoxby |
Stanford | Did Not Answer | Bio/Vote History | |
|
|
||||
 Hilary Hoynes |
Berkeley | Bio/Vote History | ||
|
|
||||
 Kenneth Judd |
Stanford | Bio/Vote History | ||
|
I would say "was" detrimental, particularly when Feds competed against states. There was no price, just chaotic & wasteful frenzy.
|
||||
 Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
|
|
||||
 Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
|
relative to what alternative? having watched many governments struggle to do basic functions does not inspire confidence
|
||||
 Pete Klenow |
Stanford | Bio/Vote History | ||
|
Public health externalities need to be internalized.
|
||||
 Jonathan Levin |
Stanford | Bio/Vote History | ||
|
|
||||
 Eric Maskin |
Harvard | Bio/Vote History | ||
 William Nordhaus |
Yale | Bio/Vote History | ||
|
|
||||
 Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
|
|
||||
 Emmanuel Saez |
Berkeley | Bio/Vote History | ||
|
With supply fixed in short run, markets don't work well (poor states can't get equipment). Need federal coordination for supply and distrib
|
||||
 Larry Samuelson |
Yale | Bio/Vote History | ||
|
Coupling pre-crisis prices with an effective centralized allocation scheme would be more effecient and better for morale.
|
||||
 José Scheinkman |
Columbia University | Bio/Vote History | ||
|
Use of masks benefits others and policies should combine penalties for non-use and subsidies for purchase.
|
||||
 Richard Schmalensee |
MIT | Bio/Vote History | ||
|
This neglects very important externalities: a mask is more valuable in the hands of a first-responder than in the hands of a rich recluse.
|
||||
 Carl Shapiro |
Berkeley | Did Not Answer | Bio/Vote History | |
|
|
||||
 Robert Shimer |
University of Chicago | Bio/Vote History | ||
|
This crisis has reinforced the importance of prices for rationing demand and increasing supply
|
||||
 James Stock |
Harvard | Did Not Answer | Bio/Vote History | |
|
|
||||
 Richard Thaler |
Chicago Booth | Bio/Vote History | ||
|
Public good not the same as WTP.
|
||||
 Christopher Udry |
Northwestern | Bio/Vote History | ||
|
There is a strong positive externality, indeed it is almost all externality. But need to ensure supply and quality too.
|
||||
Question B Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
|---|---|---|---|---|
|
Daron Acemoglu |
MIT | Bio/Vote History | ||
|
It may be better to allocate them to the needy via subsidies and government programs than price caps, which may distort signals to producers
|
||||
|
Joseph Altonji |
Yale | Bio/Vote History | ||
|
It depends on the characteristics of the good.
|
||||
|
Alan Auerbach |
Berkeley | Bio/Vote History | ||
|
|
||||
|
David Autor |
MIT | Bio/Vote History | ||
|
Not enough to ban pricing! Need a mechanism to substitute based on view that social value does not equal private value at this point in time
|
||||
|
Katherine Baicker |
University of Chicago | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Abhijit Banerjee |
MIT | Bio/Vote History | ||
|
Enforcement of price caps is always a challenge so may be the government should directly sell them
|
||||
|
Marianne Bertrand |
Chicago | Bio/Vote History | ||
|
|
||||
|
Markus Brunnermeier |
Princeton | Bio/Vote History | ||
|
the law can't be general, since regulation has to depend on supply elasticity.
|
||||
|
Raj Chetty |
Harvard | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Judith Chevalier |
Yale | Did Not Answer | Bio/Vote History | |
|
|
||||
|
David Cutler |
Harvard | Bio/Vote History | ||
|
|
||||
|
Angus Deaton |
Princeton | Bio/Vote History | ||
|
|
||||
|
Darrell Duffie |
Stanford | Bio/Vote History | ||
|
Market pricing (including gouging) in a crisis might be neoclassically "efficient" but rationing could help many poor and vulnerable people.
|
||||
|
Aaron Edlin |
Berkeley | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Barry Eichengreen |
Berkeley | Bio/Vote History | ||
|
Would raise supply, but not necessarily allocation if people are making purchase decisions on the basis of highly incomplete information.
|
||||
|
Liran Einav |
Stanford | Bio/Vote History | ||
|
|
||||
|
Ray Fair |
Yale | Bio/Vote History | ||
|
Again, externalities
|
||||
|
Amy Finkelstein |
MIT | Bio/Vote History | ||
|
|
||||
|
Pinelopi Goldberg |
Yale | Bio/Vote History | ||
|
|
||||
|
Austan Goolsbee |
Chicago | Bio/Vote History | ||
|
|
||||
|
Michael Greenstone |
University of Chicago | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Robert Hall |
Stanford | Bio/Vote History | ||
|
see previous
|
||||
|
Oliver Hart |
Harvard | Bio/Vote History | ||
|
The alternative seems a lot worse.
|
||||
|
Bengt Holmström |
MIT | Bio/Vote History | ||
|
|
||||
|
Caroline Hoxby |
Stanford | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Hilary Hoynes |
Berkeley | Bio/Vote History | ||
|
|
||||
|
Kenneth Judd |
Stanford | Bio/Vote History | ||
|
I interpret "crisis" to be an unanticipated event, one with no Arrow-Debreu price. Markets are not complete. Intervention can then be good.
|
||||
|
Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
|
|
||||
|
Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
|
suppose that SOME toilet paper had been sold at 25 times the normal price early in the crisis...
|
||||
|
Pete Klenow |
Stanford | Bio/Vote History | ||
|
Depends on what other policies are pursued.
-see background information here |
||||
|
Jonathan Levin |
Stanford | Bio/Vote History | ||
|
Sometimes beneficial to protect consumers from sudden price increases, but we need production and innovation which high prices encourage.
|
||||
|
Eric Maskin |
Harvard | Bio/Vote History | ||
|
Such laws would discourage supply. Better for government to buy at market price and distribute at lower prices. See URL for question 1
|
||||
|
William Nordhaus |
Yale | Bio/Vote History | ||
|
Too vague to be useful.
|
||||
|
Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
|
|
||||
|
Emmanuel Saez |
Berkeley | Bio/Vote History | ||
|
Just preventing high prices is not the solution, need centralized government to organize supply and distribution (just like war equipment)
|
||||
|
Larry Samuelson |
Yale | Bio/Vote History | ||
|
To raise social welfare, such laws must be complemented by a effective, coordinated allocation scheme.
|
||||
|
José Scheinkman |
Columbia University | Bio/Vote History | ||
|
It depends on supply elasticity.
|
||||
|
Richard Schmalensee |
MIT | Bio/Vote History | ||
|
For most goods, like snowshovels, externalities are not important. Non-price allocation methods are not generally ethically superior.
|
||||
|
Carl Shapiro |
Berkeley | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Robert Shimer |
University of Chicago | Bio/Vote History | ||
|
Such laws encourage hoarding and black markets
|
||||
|
James Stock |
Harvard | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Richard Thaler |
Chicago Booth | Bio/Vote History | ||
|
Not clear we need laws. The public usually enforces the laws of fairness without legal action.
-see background information here |
||||
|
Christopher Udry |
Northwestern | Bio/Vote History | ||
|
This depends on the implementation. A bad law could be a crude and ineffective tool.
|
||||
Question C Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
|---|---|---|---|---|
|
Daron Acemoglu |
MIT | Bio/Vote History | ||
|
Provided that corruption and inefficiency in choosing suppliers can be kept under control.
|
||||
|
Joseph Altonji |
Yale | Bio/Vote History | ||
|
|
||||
|
Alan Auerbach |
Berkeley | Bio/Vote History | ||
|
|
||||
|
David Autor |
MIT | Bio/Vote History | ||
|
Government should procure. Not clear government/public should transfer all surplus to private sector
|
||||
|
Katherine Baicker |
University of Chicago | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Abhijit Banerjee |
MIT | Bio/Vote History | ||
|
|
||||
|
Marianne Bertrand |
Chicago | Bio/Vote History | ||
|
|
||||
|
Markus Brunnermeier |
Princeton | Bio/Vote History | ||
|
|
||||
|
Raj Chetty |
Harvard | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Judith Chevalier |
Yale | Did Not Answer | Bio/Vote History | |
|
|
||||
|
David Cutler |
Harvard | Bio/Vote History | ||
|
|
||||
|
Angus Deaton |
Princeton | Bio/Vote History | ||
|
|
||||
|
Darrell Duffie |
Stanford | Bio/Vote History | ||
|
|
||||
|
Aaron Edlin |
Berkeley | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Barry Eichengreen |
Berkeley | Bio/Vote History | ||
|
Depends on the structure of the market. If there is, say, a monopoly of supply, time for the Defense Production Act to determine the price.
|
||||
|
Liran Einav |
Stanford | Bio/Vote History | ||
|
|
||||
|
Ray Fair |
Yale | Bio/Vote History | ||
|
|
||||
|
Amy Finkelstein |
MIT | Bio/Vote History | ||
|
|
||||
|
Pinelopi Goldberg |
Yale | Bio/Vote History | ||
|
|
||||
|
Austan Goolsbee |
Chicago | Bio/Vote History | ||
|
|
||||
|
Michael Greenstone |
University of Chicago | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Robert Hall |
Stanford | Bio/Vote History | ||
|
see previous
|
||||
|
Oliver Hart |
Harvard | Bio/Vote History | ||
|
This could work but it may be better for the government to use its bargaining/coercive powers to force price close to marginal cost.
|
||||
|
Bengt Holmström |
MIT | Bio/Vote History | ||
|
|
||||
|
Caroline Hoxby |
Stanford | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Hilary Hoynes |
Berkeley | Bio/Vote History | ||
|
|
||||
|
Kenneth Judd |
Stanford | Bio/Vote History | ||
|
This sounds a lot like the Fifth Amendment on eminent domain. I approve.
|
||||
|
Steven Kaplan |
Chicago Booth | Bio/Vote History | ||
|
|
||||
|
Anil Kashyap |
Chicago Booth | Bio/Vote History | ||
|
watching hospitals on the south side of chicago run out of supplies was awful. we can do better than that.
|
||||
|
Pete Klenow |
Stanford | Bio/Vote History | ||
|
Jonathan Levin |
Stanford | Bio/Vote History | ||
|
Yes, government may be natural purchaser in some cases, e.g. on behalf of hospitals serving low-income populations.
|
||||
|
Eric Maskin |
Harvard | Bio/Vote History | ||
|
This assumes that government can determine need
|
||||
|
William Nordhaus |
Yale | Bio/Vote History | ||
|
|
||||
|
Maurice Obstfeld |
Berkeley | Bio/Vote History | ||
|
|
||||
|
Emmanuel Saez |
Berkeley | Bio/Vote History | ||
|
Yes and Fed govt also needs to help increase supply by paying suppliers with fair prices based on production costs + reasonable bonus
|
||||
|
Larry Samuelson |
Yale | Bio/Vote History | ||
|
Effective government policy of this type would yield efficient economic outcomes and better health outcomes.
|
||||
|
José Scheinkman |
Columbia University | Bio/Vote History | ||
|
"what would have been the market price" must consider the pandemic and supply elasticities; could be much higher than pre-pandemic prices.
|
||||
|
Richard Schmalensee |
MIT | Bio/Vote History | ||
|
This might solve the externality problem, depending on how "need" is defined, but it would blunt incentives to produce.
|
||||
|
Carl Shapiro |
Berkeley | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Robert Shimer |
University of Chicago | Bio/Vote History | ||
|
|
||||
|
James Stock |
Harvard | Did Not Answer | Bio/Vote History | |
|
|
||||
|
Richard Thaler |
Chicago Booth | Bio/Vote History | ||
|
You can't trust this government to do anything.
|
||||
|
Christopher Udry |
Northwestern | Bio/Vote History | ||
|
Again, the details matter. Different approaches best for masks, vaccinations, tests, drugs for treatment.
|
||||
