Books I’m looking forward to reading: The Cost Disease

As I explained in a previous post, the effects of heterogenous productivity growth across sectors has huge impacts on the economy and on the cost of providing government services.

Here’s Larry Summers on this issue:

Third, increases in the price of what the federal government buys relative to what the private sector buys will inevitably raise the cost of state involvement in the economy. Since the early 1980s the price of hospital care and higher education has risen fivefold relative to the price of cars and clothing, and more than a hundredfold relative to the price of televisions. Similarly, the complexity, and hence the cost, of everything from scientific research to regulating banks rises faster than overall inflation. These shifts reflect long-running trends in globalization and technology. If government is to continue providing the same level of these services, government spending as a share of the economy has to rise, by at least 3 percent of GDP.

Finally, here’s the new book itself – Baumol’s The Cost Disease: Why Computers Get Cheaper and Healthcare Doesn’t.

About ozidar

I'm an Assistant Professor of Economics at the University of Chicago Booth School of Business and a Faculty Research Fellow at National Bureau of Economic Research. You can follow me on twitter @omzidar.
This entry was posted in Uncategorized and tagged , , , . Bookmark the permalink.

2 Responses to Books I’m looking forward to reading: The Cost Disease

  1. Pingback: Why Healthcare, Education, and Government Spending Keep Going Up – Baumol’s Cost Disease | owenzidar

  2. Pingback: What books do top CEOs, policymakers, academics, etc recommend reading this year? | owenzidar

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s