July 2018

Klenert, Hepburn, 31 July 2018, 5996 reads

Political acceptability is the biggest challenge to implementing ambitious carbon pricing schemes. This column argues that behavioural economics and political science provide new insights into the acceptability of carbon pricing which suggest that successful reforms are more likely when the revenues are recycled through lump-sum dividends to citizens. There is no ‘one size fits all’ solution, however, and revenue recycling strategies should account for different social and political contexts and will most likely be mixed in real-world carbon pricing schemes.

Alesina, Miano, Stantcheva, 31 July 2018, 12231 reads

The debate on immigration is often based on misperceptions about the number and character of immigrants. The column uses data from surveys in six countries to show that such misperceptions are striking and widespread. The column also describes how an experiment in which people were encouraged think about their perception of immigrants made them more averse to redistribution in general, suggesting that the focus on immigration in the political debate – without correcting the misperceptions respondents have about immigrants – could have the unintended consequence of reducing support for redistribution.

Feld, 31 July 2018, 7539 reads

In their CEPR Policy Insight, the team of French and German economists focus on a compromise between market discipline and risk sharing. This column, part of the VoxEU debate on euro area reform, argues that their proposal fails to address legacy debt problems convincingly and that the introduction of a fiscal capacity would repeat the mistakes made at the introduction of EMU, with later steps towards European integration being attempted before the necessary first steps have been taken.

Niepmann, Stebunovs, 30 July 2018, 5458 reads

In the European Banking Authority’s EU-wide stress tests, banks project capital ratios under a hypothetical adverse scenario employing their own models, which are constrained by a common methodology set by the Authority. This column argues that letting banks produce their own projections means they are prone to manipulation. It finds evidence that banks' internal models are modified to lessen losses given the applicable scenarios and exposures. Without this manipulation, projected aggregate credit losses would have been up to 28% higher in the 2016 stress tests. 

Clark, Cummins, 30 July 2018, 27357 reads

Northern England is now less educated and less productive than the south. This north-south divide is often characterised by policymakers as evidence of market failure. This column uses surname distributions to show that the northern decline can instead be explained by persistent outmigration of talent from the north. People of northern origin perform as well on average as those of southern origin. Talented northerners, however, are now mainly located in the south, where they are an economic elite.

Fan, Liu, Qian, Wen, 29 July 2018, 4107 reads

Enforcement of VAT requires accurate records of firm transactions that can be traced to both parties. This column describes how the Chinese government’s digitisation of the country’s VAT process increased enforcement, which in turn increased overall tax revenues in the short run. However, the increased enforcement caused firms to contract in the medium run, reducing the long-run gains in tax revenues.

Federico, Tena-Junguito, 28 July 2018, 17055 reads

Global trade data for periods prior to WWII are notoriously incomplete and unreliable. This column describes a new dataset of historical world trade that addresses many of these flaws. The World Trade Historical Database comprises imports and exports for polities beginning in 1800, and also includes international prices for 190 products, freight rates, and exchange rates, where available. Though focused on aggregate trade, the data include information on the composition of trade from numerous sources.

Bordignon, Gatti, Onorato, 27 July 2018, 4589 reads

While it was obvious at the time of the introduction of the euro that the euro area did not satisfy the criteria for an optimal currency area, increased economic convergence was expected to make it easier to introduce the institutional reforms necessary to converge into a fully-fledged political union. This column examines convergence among early EMU entrants in terms of public services, product and labour markets regulation, and quality of institutions. The main message is pretty clear: the viability of the EMU project seems to be more in trouble on political rather than economic grounds.

Caffarra, Latham, Bennett, Etro, Régibeau, Stillman, 27 July 2018, 6659 reads

The European Commission’s decision to fine Google €4.34 billion for abuse of market power has been accused of being politically motivated and of risking higher prices for consumers. This column argues that the Commission’s decision has economic merit and falls within established legal precedent. As mobile search is the key gateway to access information, we should be concerned about dominance in this market for its potential distortionary effects on innovation and consumer outcomes across multiple other markets.

Novy, 27 July 2018, 3583 reads

When President Trump recently spoke of his hope for "a great bilateral trade agreement” with the UK after Brexit, what did he really mean? Dennis Novy of the University of Warwick describes what these political good intentions may look like in reality, the problems that both sides will have to solve to agree a UK-US deal, and the factors that might derail any agreement.

Baltrunaite, Giorgiantonio, Mocetti, Orlando, 26 July 2018, 4932 reads

Public procurement outcomes crucially depend on the ability of the procuring agency to select high-performing suppliers. This column uses Italian data to explore how public administrator discretion affects public resource allocation. Greater discretion results in reallocation towards politically connected, low-performing firms. These adverse effects are driven by lower-quality procuring agencies.

Prat, Valletti, 26 July 2018, 5854 reads

Competition authorities struggle to evaluate the effect of mergers between social media platforms when prices are zero and standard tools like cross-price elasticities are of little use. This column argues that social media platforms are 'attention brokers' that help incumbents maintain market power in other industries by restricting producers’ targeted access to individual consumers. User overlap is more important as a predictor of competition problems than traditional aggregate usage shares. 

Gorodnichenko, Revoltella, Svejnar, Weiss, 25 July 2018, 6249 reads

Many barriers keep resources from flowing to the most efficient firms in the EU. This column uses firm-level data from all EU countries to explore how the dispersion of resources affects macroeconomic performance. Harmonising the business environment – and thus easing the flow of resources – across countries and industries could increase aggregate EU growth by 18%. The findings also demonstrate how firm-level characteristics can help us understand distortions in the allocation of resources across firms. 

Barany, Siegel, 25 July 2018, 7109 reads

Economists agree that structural transformation and job polarisation are both caused mainly by biased technological progress, but there is no consensus on the nature of these biases. The column uses US data to estimate the extent to which technological change is biased across sectors and across occupations. It finds that for improved labour market outcomes, policies targeting occupational choice for workers might be better than industrial policies to protect sectors of the economy.

Cabrales, Güell, Madera, Viola, 24 July 2018, 6827 reads

In most of Europe, the state pays for a university education, meaning that university finances are both regressive and cyclical. This column asks how the alternative system of income-contingent university loans would fare in Spain. The analysis suggests that the policy is feasible even in a country with a relatively poorly functioning labour market for young graduates.

Howell, Niessner, Yermack, 23 July 2018, 7102 reads

Initial coin offerings, whereby a blockchain-based venture raises capital by selling cryptographically secured digital assets (or ‘tokens’), may represent a significant innovation in entrepreneurial finance. This column studies a sample of 453 tokens that completed ICOs to investigate what types of issuer and token are successful. Tokens that offer voluntary disclosure, credibly commit to the project, and signal quality or potential to create substantial value tend to be more successful, and a founder or CEO with an entrepreneurial professional background is also beneficial.

Tørsløv, Wier, Zucman, 23 July 2018, 61370 reads

Between 1985 and 2018, the global average statutory corporate tax rate fell by more than half. This column uses new macroeconomic data to argue that profit shifting is a key driver of this decline. Close to 40% of multinational profits were artificially shifted to tax havens in 2015, and this massive tax avoidance – and the failure to curb it – are in effect leading more and more countries to give up on taxing multinational companies. 

Levy, 22 July 2018, 9207 reads

The euro improved the credibility of monetary policy for many member states, but the downsides of not having monetary autonomy became painfully apparent during the European debt crisis. This column proposes ‘targeted inflation targeting’ as a way to improve stabilisation mechanisms in the euro area, without losing the benefits of integration. The ECB would maintain a rules-based approach that targets countries in a weaker macroeconomic position more aggressively.

Brunow, Birkeneder, Rodríguez-Pose, 21 July 2018, 6089 reads

Research is increasingly pointing to the rising concentration of creative and science-oriented workers as the basic force for making cities, and large cities in particular, the contemporary motors of innovation. This column examines whether this is the case in Germany. The results suggest that creative workers’ innovation is constrained to the boundaries of the firm, while science-based workers generate considerable innovation spillovers. Policies to generate innovation in Germany are likely to yield greater returns by focusing on ‘geeks’ rather than ‘creatives’, and innovation policy should look beyond the largest cities to a broader range of territories that have proven attractive to ‘geeks’.  

Newbery, 20 July 2018, 5622 reads

The cost of supporting the production of renewable energy seems eye-watering. This column argues, however, that the alternative of a future energy system lacking the benefits of low-cost zero-carbon technologies is even more costly. While most renewable technologies are not yet competitive on cost with mature carbon-intensive technologies, support for renewables can be justified by learning spillovers.

Bertoldi, Pesenti, Rey, Wagner, 20 July 2018, 9388 reads

Ten years after the global crisis, transatlantic relationships are at a crossroads. This column summarises a conference jointly organised by the New York Fed, the European Commission, and CEPR at which the participants discussed the strength of current growth prospects and the likelihood of inflation remaining subdued in advanced economies, and whether the current regulatory and policy frameworks are well suited to supporting financial stability and growth. One conclusion was while an escalation in trade tensions between the US and EU would have significant economic consequences on both sides of the Atlantic, this is not a foregone conclusion and there is room to uphold and strengthen the transatlantic relationship.

Buti, Tomasi, 20 July 2018, 11413 reads

International economic cooperation is in crisis. The global economy faces fragmentation across institutional, economic, and social dimensions. This column argues that the task of the G20 is to revamp international economic cooperation and to promote a multilateral approach that addresses the key concerns of our citizens starting with greater inclusiveness and fairness. Europe can play a leading role in a world in search of a new anchor. 

Rosés, Wolf, 20 July 2018, 2762 reads

Inequality between Europe's regions has risen in the last few decades. Joan Rosés and Nikolaus Wolf discuss their research on inequality at both the personal and regional levels across Europe in the last century. Rising regional inequality is one factor behind the growing populism in Europe.

Bini Smaghi, Marcussen, 19 July 2018, 3986 reads

The euro area debt crisis saw the region ravaged by multiple sovereign bond doom loops and has inspired several proposals for a single safe asset for the region. While a lack of political consensus has proven the main obstacle to date, technical issues relating to the complexity of splitting the existing sovereign debt stock and concerns on contagion amongst senior and junior debt structures also weigh in. This column, part of the VoxEU debate on euro area reform, illustrates how a 20-year Purple bond transition could address these issues and offer a path to genuine Eurobonds.

Hall, 19 July 2018, 3388 reads

Patent protection is assumed to benefit entrepreneurs seeking investment, because patents signal quality and are an asset that can be resold if a startup fails. This column argues that the evidence for these benefits is inconclusive. Notably, patents acquired in a secondary market may be used for rent-seeking, rather than to incentivise innovation.

Bijnens, Konings, 19 July 2018, 6875 reads

Evidence from the US indicates that business dynamism is declining, and that this affects overall productivity growth. This column explores business dynamism in Belgium between 1985 and 2014. The results show remarkable similarities to those from the US, suggesting that these changes are likely due to global trends such as the rise of information and communication technology.

Agarwal, Jensen, Monte, 18 July 2018, 12458 reads

Although the internet has greatly reduced the travel frictions that consumers face, for many goods and services, consumers’ willingness to travel is still a key factor influencing firms’ decisions. This column explores consumer mobility and purchases using credit card transaction data. Predictably, consumers travel further for more durable and less frequently consumed goods. The results suggest that consumer mobility may be relevant at the individual level and in the formation of local equilibrium outcomes.

Born, Müller, Schularick, Sedláček, 18 July 2018, 24801 reads

Growth and employment in the US have been robust over the past 18 months, and President Trump frequently takes personal credit for these trends. This column explores how the US economy would have evolved without Trump. An analysis shows no difference between the post-election performance of the US economy under Trump and a synthetic ‘doppelganger’ US economy without Trump, suggesting that there has been no ‘Trump effect’.  

Brunnermeier, Abadi, 17 July 2018, 26003 reads

Cryptocurrencies and the underlying distributed ledger technology have exploded into public consciousness over the last few years, with devotees insisting that the technology will revolutionise financial transactions and ownership data. This column identifies a ‘blockchain trilemma’ whereby no ledger can fully satisfy the three desirable properties of decentralisation, correctness, and cost-efficiency. It further explains how distributed ledgers enhance competition but introduce costs above and beyond the well-known electricity costs.

Cahuc, Kramarz, Nevoux, 16 July 2018, 3612 reads

Short-time work programmes aim to preserve jobs at firms that are experiencing temporarily low revenues, for example during a recession. This column assesses how the short-time work programme implemented in France during the Great Recession affected employment. Results confirm that the programme saved jobs and increased hours worked, and that participating firms recovered faster than non-participating firms. 

Casey, Crane, Gensler, Johnson, Narula, 16 July 2018, 5996 reads

The idea of a new software system that powers a consensus-driven form of shared record keeping has already had a profound effect, encouraging rapid and substantial investment in what is now commonly referred to as blockchain technology. This column introduces the latest Geneva Report on the World Economy, which assesses the available evidence and likely impact for this technology across a wide range of applications and explores the potential use cases for the financial sector, and the ways in which the organisation of these activities may change over time.

Johnson, 16 July 2018, 2702 reads

Blockchain technology has the potential to be a catalyst for change to incumbent financial sector firms. In this Vox Talk, Tim Phillips talks to Simon Johnson, one of the authors of the latest Geneva Report on the World Economy which looks at the technology and its possible applications. 

Tabellini, 16 July 2018, 5269 reads

A key question in the debate on the reform of the euro area concerns the right mix between risk sharing and market discipline. This column, part of the VoxEU debate on the topic, argues that proposals to enhance market discipline in the euro area are counter-productive, because they increase the vulnerabilities of countries with high legacy debts. 

Schumacher, Trebesch, Enderlein, 16 July 2018, 4493 reads

For centuries, sovereign debt was assumed to be ‘above the law’ and non-enforceable. This column shows that this is no longer the case. Building on a new dataset on sovereign debt lawsuits, it documents the erosion of sovereign immunity since the 1970s and argues that legal disputes can disrupt government access to international capital markets, as foreign courts impose a financial embargo on defaulting sovereigns. These legal developments have strengthened the hands of creditors and raised the cost of default for debtors, with far-reaching consequences for government willingness to pay and the resolution of debt crises.

Simeonova, Akee, Holbein, Copeland, Costello, 15 July 2018, 4962 reads

Political scientists have shown conclusively, at least in the US, that richer people vote more, which has troubling implications. Using data from a government cash transfer programme, this column shows that children who grew up in households in the bottom half of the income distribution that received extra income were more likely to vote as adults compared to their counterparts who did not receive the transfers. The results suggest that efforts to reduce income inequality may have the unexpected side effect of reducing gaps in civic participation.

Laget, Osnago, Rocha, Ruta, 14 July 2018, 7514 reads

The making and unmaking of trade agreements affects global production. This column reveals how deeper agreements have boosted countries’ participation in global value chains and helped them integrate in industries with higher levels of value added. Investment and competition now drive global value chain participation in North-South relationships, while removing traditional barriers remains important for South-South relationships.

Buti, Chabin, Döhring, Leal, 13 July 2018, 3956 reads

Next week, after ten days of swift, flat riding, the Tour de France reaches the Alps. The European economy, meanwhile, has been pedalling uphill since the beginning of this year. 2017 was easy riding as strong global growth boosted domestic investment, but economic growth has had to move into lower gear in the first half of 2018 as this transmission is no longer working properly, and escalating trade conflicts could derail it. This column presents the European Commission’s Summer 2018 Interim Forecast, which suggests that a tightening of global financial conditions could add to the headwinds, though central banks' balance sheets will remain large for a long time, and domestic fundamentals in the euro area remain strong. 

Iammarino, Rodríguez-Pose, Storper, 13 July 2018, 7630 reads

Regional economic divergence has become a threat to economic progress, social cohesion, and political stability in Europe. Market processes and policies that are supposed to spread prosperity and opportunity are no longer sufficiently effective. This column argues that a different approach to economic development is required – one that would strengthen Europe’s strongest regions, but with new methods and instruments to unleash the economic potential of weaker cities and regions. The approach should be adaptable to the specific characteristics, structures, and challenges faced by different groups of cities and regions. 

Kleven, Landais, Egholt Søgaard, 12 July 2018, 9381 reads

Despite considerable convergence over time, substantial gender inequality persists in all countries. Using Danish data, this column argues that this gap persists because the effects of having children on the careers of women relative to men are large and have not fallen over time. Additional findings suggest this effect may be related to inherited gender identity norms.

Decker, Haltiwanger, Jarmin, Miranda, 12 July 2018, 7227 reads

Job reallocation is an important determinant of productivity. This column uses US data to show that a decline in the degree of job reallocation in response to shocks is behind the overall fall in the rate of reallocation over the past decades. Weakening responsiveness became a drag on aggregate productivity for high-tech businesses in the 2000s, but in other sectors the problem dates back to the 1980s. 

Gerlach, Stuart, 11 July 2018, 9256 reads

Many market commentators are worried that the gradual flattening of the US term structure in recent months is indicative of an increased risk of a recession. This column argues that the term structure contained information about the likelihood of a future recession even before the establishment of the Federal Reserve, suggesting that the information content does not arise solely as a consequence of countercyclical monetary policy.

Ahmed, Bussolo, Cruz, Go, Osorio Rodarte, 11 July 2018, 9253 reads

Average education levels are increasing in developing countries, but not in high-income countries. The column argues that this 'education wave' in developing countries will reduce global inequality by 2030, with average incomes up to the 90th percentile all benefitting from the trend. However, this equalising effect relies on continued globalisation.

Lincoln, McCallum, 10 July 2018, 5936 reads

The number of US firms that export increased dramatically over the past few decades. This column argues that while foreign market entry costs have been stable over time, declines in telecommunications costs, free trade agreements, and economic growth abroad have been vital drivers of the globalisation of US firms.

Bénassy-Quéré, Brunnermeier, Enderlein, Farhi, Fratzscher, Fuest, Gourinchas, Martin, Pisani-Ferry, Rey, Schnabel, Véron, Weder di Mauro, Zettelmeyer, 10 July 2018, 6044 reads

EU leaders addressed euro area reform at the Euro Summit on 29 June. In this column, which we add to the VoxEU debate on euro area reform, the group of 14 French and German economists behind the recent CEPR Policy Insight on the topic argue that the summit statement represents a constructive first step and crosses red lines that were considered taboos only a few months ago. However, the summit’s commitments still fall short of a comprehensive package.

Chen, Novy, 09 July 2018, 5996 reads

Currency unions usually go hand in hand with deeper economic integration. But does that automatically mean more international trade? This column shows that since the end of WWII, currency unions have on average been associated with 40% more trade between member countries. The ‘thin’ relationships between countries who do not trade much with each other benefit the most from currency unions, with little in the way of a boost for more established trading relationships. 

Tsyvinski, Werquin, 09 July 2018, 4913 reads

Many economic disruptions create winners and losers. This column presents an analytical formula for tax reform to offset welfare losses by redistributing the winners’ gains when tax instruments are distortionary and wages are endogenous. It shows how the model can be applied to empirical data, for example to offset the impact of robots in the US and Germany.

Razin, Sadka, 08 July 2018, 6347 reads

Financial globalisation triggers tax competition among countries and the possibility of a ‘race to the bottom'. This can chip away at the domestic tax base, and the reallocation of international capital is likely to result in the downscaling of the scope and size of redistribution under the welfare state. This column argues, however, that even a reduced welfare state can still act as a device to compensate the losers from financial globalisation losers in a Pareto-improving way. 

Simeonova, Currie, Nilsson, Walker, 08 July 2018, 4006 reads

Traffic congestion is a major problem for urban centres. Among various negative externalities, traffic creates substantial pollution which can impact the health of residents. This column explores how the implementation of a congestion pricing zone affected the health of children in Stockholm. The programme saw short-term reductions in common traffic pollutants and an accompanying decrease in children’s hospital visits for acute asthma. This decrease grew larger the longer the tax was in place. 

Bertasiute, Massaro, Weber, 07 July 2018, 5105 reads

A key critique of commonly used macroeconomic models is their reliance on the assumption of rational expectations. This column addresses this concern with a model of currency unions wherein expectations are formed through behavioural reinforcement learning, that is, learning from past mistakes. The model suggests that economic integration is of crucial importance to the functioning of a currency union. Monetary policy, in contrast, can only play a limited stabilising role.

Marchesi, Masi, 06 July 2018, 4336 reads

Euro area governments have just negotiated a debt relief agreement for Greece, but without face-value debt reduction. This column argues that specific characteristics of sovereign debt renegotiations have significant economic implications. When debt relief operations involve write-offs, the defaulting country benefits strongly in term of growth up to ten years after the restructuring. 

Weder di Mauro, 06 July 2018, 3051 reads

Central banks are concerned about the impact of cryptocurrencies. In this Vox Talk, Tim Phillips talks to Beatrice Weder di Mauro about the sources of this concern, and whether the disappearance of cash and a desire to escape the zero lower bound will lead to central banks issuing their own digital currencies.   

Lin, Lincoln, 06 July 2018, 5454 reads

Disagreements over intellectual property rights policies have been a major roadblock in recent trade agreement talks, and the issue has also been a pillar of critiques of globalisation. This column discusses new research that matches confidential, comprehensive data on firm patenting and trade behaviour for the first time. It shows that, all else equal, firms who hold patents in the US are significantly more likely to export to countries that better protect intellectual property rights.

Bussière, Chinn, Ferrara, Heipertz, 05 July 2018, 6596 reads

The ‘Fama puzzle’ is the finding that ex post depreciation and interest differentials are negatively correlated, contrary to what theory suggests. This column re-examines the puzzle for eight advanced country exchange rates against the US dollar, over the period up to February 2016. The rejection of the joint hypothesis of uncovered interest parity and rational expectations still occurs, but with much less frequency. In contrast to earlier findings, the Fama regression coefficient is positive and large in the period after the Global Crisis, but survey-based measures of exchange rate expectations reveal greater evidence in favour of uncovered interest parity.

Levinson, 05 July 2018, 6208 reads

When it comes to solving externalities like pollution, efficiency standards are more popular than taxes. The rationale behind this is that the burden of taxes would fall disproportionately on the poor. This column argues that standards are in fact more regressive than taxes. Given their lower cost, the results suggest that tax solutions should be favoured over efficiency standards. 

Cong, He, 05 July 2018, 8715 reads

Blockchain technology provides decentralised consensus, which potentially enlarges the contracting space using tamper-proof smart contracts. But this implies distributed information. The column argues that there is a tension between these two features of blockchain. While complete contracts may increase competition, distributed information may also make collusion between incumbents more effective. 

Aum, Lee, Shin, 04 July 2018, 9083 reads

The past three decades have seen unprecedented technological development, with major impacts on labour markets and the economy as a whole. This column investigates how automation and the increased use of computers has affected productivity trends over the last three decades. Results suggest that automation has had a strong effect on slowing down aggregate productivity, despite raising it at the micro level. This is due to the reallocation of factor inputs across occupations and industries. 

Alfaro, García Santana, Moral-Benito, 04 July 2018, 5036 reads

Propagation through buyer-seller interactions may amplify the aggregate impact of bank lending shocks on real activity. This column presents insights from estimating the direct and indirect effects of exogenous credit supply shocks in Spain between 2002 and 2013. Both direct and indirect effects of bank credit shocks had sizable effects on investment and output throughout the period. Trade credit extended by suppliers and price adjustments both appear to explain downstream propagation of financial shocks.

McLeay, Tenreyro, 03 July 2018, 10949 reads

The Phillips curve – a positive relationship between inflation and economic slack – is one of the building blocks of the standard macroeconomic models used for forecasting and policy advice in central banks. On the face of it, recent findings of a breakdown in this relationship would therefore have major implications for monetary policy. This column argues that these findings are perfectly consistent with a stable underlying Phillips curve. The reason is simple: monetary policy will typically seek to reduce output whenever inflation is set to rise above target, blurring the identification of the Phillips curve in the data.

Akcigit, Ates, Impullitti, 02 July 2018, 9596 reads

The optimal set of industrial policies to tackle increased competition from global technological rivals is once again the centre of a heated debate, with protectionist policies now gaining traction. Drawing on US experience three decades ago, this column examines the effects of import tariffs and R&D subsidies on domestic firms’ global competitiveness, aggregate growth, and welfare. It argues that import tariffs generate large dynamic productivity losses and may enhance welfare only for a short time horizon and when trading partners do not retaliate. By contrast, R&D subsidies stimulate domestic innovation and increase welfare, especially over longer time horizons, without jeopardising the gains from trade. 

Narayan, Van der Weide, 02 July 2018, 12675 reads

Intergenerational mobility is important for both fairness and economic efficiency in a society. This column uses data from a new global study spanning five decades to show that average relative mobility is lower in developing economies, with no sign that the gap with developed countries is getting smaller. In addition, income mobility in several developing economies is much lower than their levels of educational mobility would lead us to expect. Labour market deficiencies appear to be contributing to this gap between mobility in education and income. 

Koijen, Van Nieuwerburgh, 01 July 2018, 4441 reads

Over the past decade, exciting breakthroughs in the field of immuno-oncology have resulted in significant gains in long-term cancer survival, but the cost of immunotherapy is often extremely high. This column argues that life insurance would become a more valuable product to consumers if it were to pay for life-enhancing medical treatment in case of a cancer diagnosis. Widespread adoption of this funding model would increase life expectancy in the population, which would in turn lower the cost of life insurance.

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