Read A Cartoon Introduction to #Economics by @standupecon

A Cartoon Introduction to Econonomics

While on a trip to Hong Kong, I’ve been reading A Cartoon Introduction to Economics, Volume 1: Microeconomics, by Grady Klein and Yoram Bauman.

Economics permeates many areas of public health, even for those of us who are not economists. Cost effectiveness analysis, which focuses on whether the gain achieved by introducing a new drug, technology or intervention outweighs its cost, is of course a key area of public health and is highly influential in determining, for example, whether a new vaccine will be introduced. But economics is not specifically about money – it can help us to figure out why people behave in certain ways, often in ways that seem harmful either to themselves or to the rest of society. Economics is also important to understand why we sometimes introduce well-meaning interventions that end up having perverse, unintended consequences. To give an example, sleeping under an insecticide-treated bednet is one of the most effective ways to protect yourself against malaria. It would therefore seem like a good idea to provide bednets to communities in under-resourced areas of sub-Saharan Africa and parts of Asia and Latin America, where malaria is most prevalent. Providing them for free would remove the barrier to access, while making the nets attractive would make them more appealing for people to use. But there are numerous examples of programmes in which recipients felt the nets were so nice that they did not want to use them, or used the nets for fishing instead, which is a far more lucrative use for a bednet, but has the unfortunate consequences of not protecting people from malaria, contaminating water supplies with insecticides, and contributing to the depletion of fishing stocks. So while the effectiveness of insecticide treated bednets is unquestioned, some questions nevertheless remain about how best to deliver them.

In their humorous, graphic novel approach to microeconomics, Klein and Bauman begin with the economic premise that people are optimizing individuals – they act in self-interested ways to achieve their desired preferences. They then take us on a tour of basic economic principles, from annuities, through trade, pareto efficiencies, information asymmetry, and the theory of games, with the aim of exploring the circumstances under which the actions of optimizing individuals can yield outcomes that are also beneficial to society, the microeconomist’s ultimate interest. There are many examples of this that are relevant to public health. Measles vaccination, for example, protects individuals from getting measles, but having lots of vaccinated individuals in the population who cannot themselves transmit the infection to others, also serves to protect vulnerable individuals in the population who cannot be vaccinated, such as those with immune deficiencies and very young children.

The converse of this, in which people acting in their own self interest leads to consequences that are harmful for everyone, is the principle of the tragedy of the commons. Klein and Bauman give overfishing and climate change as examples. Another example that is currently and rightly gaining a lot of attention is antimicrobial resistance, a public health issue that threatens our ability to deliver safe, quality healthcare that we currently take for granted. People take antibiotics to make themselves feel better, even when those antibiotics have no effect (such as when they are used to treat common viral infections). Overuse of antibiotics has the consequence of selecting out and promoting the spread of bacteria that are resistant to those antibiotics, limiting our options to treat infections in those who really need antibiotics, such as surgical patients or children with pneumonia.

A Cartoon Introduction to Economics is an engaging read for those who are interested in learning the basics of economic theory away from dry economics textbooks and want to see how these principles apply to every day situations in a fun, accessible way. Some of these principles are highly relevant to our own research. I encourage you to check out our hawker trade network study, in which we’re mapping the food supply to hawker centres in Singapore and collecting information about relationships between hawkers and food suppliers. The public health literature on food safety issues is dominated by microbiology and the epidemiology of outbreaks. But economics is at the heart of food safety issues. Numerous high-profile outbreaks of foodborne illness can be traced back to individuals or corporations breaching food safety regulations as a consequence of cutting costs, as in the recent case of Stewart Parnell, who was jailed for 28 years for knowingly supplying peanut products contaminated with Salmonella, leading to an outbreak involving 714 recognized cases and 9 deaths. The relationships that retailers have with their suppliers is crucial to food safety. An emphasis on cheaper costs can be detrimental, because lower prices can often only be achieved at the expense of product safety, and retailers who continuously look for cheaper products are likely to switch suppliers more often, making it more difficult to trace contaminated food products. An emphasis on trust or quality, on the other hand, can be beneficial to both individual retailers and society, because retailers get benefits from closer, long-standing relationships with suppliers, and that loyalty means that the food supply network is more stable, making traceability easier. These are issues we are studying in our hawker project. We are in the midst of processing and analyzing the data, but we’ll keep you posted!

Leave a Reply

Your email address will not be published.

Back To Top
Skip to toolbar