Three opinions. Right?
Well, apparently not--at least not on some issues. The University of Chicago's Institute on Global Markets has pulled together a panel of respected academic economists, and is asking them to agree or disagree with a series of policy-related statements. Watching the consensus (or lack thereof) is interesting on a variety of topics, but we found last week's statement particularly notable:
There are no consequential distortions created by the tax preference that favors obtaining health insurance through employers.
Obviously, we care because it's health-related, but the level of consensus is interesting as well. Contrary to the common perception of economists as constantly disagreeing with each other, 95% of economists surveyed either disagreed or strongly disagreed with the proposition. Taking their confidence in their answers into account, 97% disagreed (63% strongly).
The poll doesn't ask whether the employer-sponsored system, or even the tax preference, is a good thing--it only asks if it creates distortions. On that, the near-unanimity sends a strong messge: both labor markets and health care markets are affected by the subsidy. It keeps people pinned to jobs that they'd prefer to leave, and induces over-insurance and over-consumption of health care. Addressing that overconsumption--and the incentives that create it--is critical to bringing down our long-term health costs.
Thanks to Jodi Beggs of Economists Do It With Models for the tip on the IGM Forum.