Interview with Ashley Hodgson, Healthcare, Heterodox and Youtube Economist
By: The Moral Economist
Tags: Economics, Healthcare, YouTube

Your PhD thesis was “Essays on the Evolution of Healthcare Technology.” In particular, you looked at 3 empirical case studies of how government policy and supply side factors can impact technological diffusion. First, you find that Medicare’s prospective payment system results in fewer innovations for elderly patients compared with non-elderly. Second, you found how new procedure codes cause “sudden jumps” in the number of procedures performed per quarter. Finally, you look at how some supply side factors like physician per capita density affects new ADHD drug geographic diffusion.

How long did it take you to write your thesis? What classes inspired your research? How did you develop your model and how did you gain the statistical skills to do your empirical work?

It wasn’t necessarily classes that inspired this research. I had always been very interested in health care innovation, and a couple of provocative seminar speakers got my brain thinking about how innovation happens, and how financial incentives cause some types of technologies to be favored over others. A small difference in the types of technologies we invest in today for research and development will lead to large differences in the “shape” of medical care in the long-run. My dissertation looked at the incentive to develop more diagnostic technologies (as opposed to therapeutic technologies), because Medicare pays by diagnosis. Therefore, there might be an incentive to develop technologies that uncover new diagnoses. It’s been a while since I thought about it, but I’m still very interested in innovation in health care.

Your Youtube channel has over 5000 subscribers. Congrats! You typically post a new video at least once a week on topics as varied as behavioral economics, game theory, ethics, healthcare, social media, and blockchain. How long does it take to make an average video? How much time do you invest in your channel per week? How long did it take to build up your channel to where you felt you were getting the viewership you deserve? (You still aren’t yet in my opinion!)

Video-making probably takes about 3 hours a week. It took a lot more time in the beginning, because I had to figure out how video-making worked. The pandemic forced me to make a lot of videos for my classes and finally got me into a sustainable habit of putting out videos regularly, so I’m thankful for that. Video-making has been fun.

Getting meta for a moment, where do you think the field of economics is going in the 21st century? What would Star Trek economics be like? In other words, what happens to economists when we finally become Keynes’ grandchildren and only work 5 hours per week? What would the AI singularity do to the field of economics?

I’m not sure about the AI singularity, but there are a few directions that I think the field of economics would benefit from exploring more. Some economists have begun to explore network models, and I think we need a lot more research related to networks, particularly since networks of people and information flow are so important in shaping trends and the spread of information and misinformation. As you know, I’m a fan of behavioral economics. Those models can be powerful, but they are almost always seated at a single point of decision-making, from a snapshot in time. I think there is room to explore evolutionary decision-making processes, and to develop reactionary arational models of behavior. Lisa Feldman Barrett (author of How Emotions Are Made) describes a model of human behavior that is based on a body budget and constant predictions that are happening below conscious thought. That seems like an accurate depiction of the human experience, and I think it could be modelled by economists in that way. And, of course, I think we need to do a lot more research that is related to the non-finance applications of blockchain. In particular, I believe that blockchain will be a powerful tool for collaboration and for solving a number of public-goods dilemmas. But we need more research on governance of medium-sized communities, the evolution of collaborative communities, the game theory of sharing communal resources in online space, etc. What a fun question! Thanks for asking.

You are the department chair of economics at St. Olaf College. How did you get into that position? Your teaching load includes blockchain economics, healthcare, behavioral economics, game theory and microeconomic theory. Do you think we can rebuild microeconomic theory without reference to utility states? Would that make economics more scientific? What do you think of the field of neuroeconomics? Perhaps we can replace utilities with something referencing brain states as measured by something like an MRI machine…

Our department is a bit “generational”, and I was the first person hired into the new generation. That is how I got to be department chair so quickly after getting tenure. I don’t think microeconomics needs to be re-built without utility states. Utility is a stepping stone concept, and a big umbrella concept. Better models are going to specify different types of utility (self-esteem utility, impure altruistic utility, relational experience utility, autonomy utility, etc). The field of neuroeconomics is really exciting, and exactly the kind of thing that could add some interesting twists to economic theory. I do believe that brain states could be indicative of certain types of pleasurable and non-pleasurable states, and that different types of utility could be attached to measurable brain states. However, I’m not 100% convinced that observable brain states will be able to capture all aspects of value that humans experience. For example, I could see some deeply powerful states like “hope” being distributed across time in the way they are experienced, and therefore not necessarily powerfully present in the brain at any moment. Same with autonomy, purpose, etc.

Traditionally, economics is defined as the study of scarce resources and their alternative uses. Some like Gary Becker define economics as the study of rational/optimizing behavior by those with stable preferences. Personally, I find these definitions too narrow, since many economists study abstract mathematical models. And hopefully we can one day come up with a theory of changing preferences!

I prefer something like “economics is the study of agents, the evolution of their brain states, and their (complex) interactions in (arbitrary) environments (over time).” This kind of definition could expand economics from the study of humans, to the study of animal/alien/star trek economics, AI, and other advanced/complex agents, or just arbitrary mathematical objects. What do you think of this definition. How would you define economics?

I like your definition! I view economics as a set of tools developed by a community that at one point in time studied the allocation of scarce resources. Since that time, the field has expanded both the toolkit and the topics it covers. Some definitions of the field focus on the microscope or toolkit. Other definitions focus on the object being studied (scarce resources, once upon a time). I tend to favor the microscope-style definitions, but see a place for both types of definitions. The field, in a lot of ways, is evolving, and the definitions of its boundaries are changing. The question is: What unites the community of economists? I think it has some thing to do with a rigorous way of organizing thought about causality in the world. Sometimes I find it useful to return to the “allocation of scarce resources” definition when I’m thinking about a particular topic, but that definition is no longer all-encompassing.

6. Here are some normative questions for you. How do you think the field of economics could become more retrospective regarding the normative implications of our theories? How can we be more cognizant of the impact of our ideas on the variables we study? How do you think we can improve the unequal treatment that minorities and women get when it comes to healthcare? What has your experience been as a female economist? How can economics bring more women into the field?

I’m very interested in the way the field of economics evolves. I do think it’s important to bring ethical considerations in alongside our theories. The most important thing in terms of ethical considerations on our theories is to make viewpoint diversity a priority. Each person has blind spots, including ethical blind spots. And we tend to want to keep people out whose perspectives point out our ethical blind spots. I’d rather have space for wild ideas of all kinds, with a conversation across viewpoints that can catch the flaws in each way of thinking. I would strongly worry if the field came to too strong of a consensus about what is and is not unethical, and kept people out who opposed that notion. Viewpoint diversity is a better approach, in my opinion. Also — if you’re interested in this type of conversation (about the evolution of the field, ethics and theory, etc), consider joining the Heterodox Academy economics community, which I organize. We talk about viewpoint diversity within the field of economics and more broadly. You can request to join on this page: https://heterodoxacademy.org/hxcommunities/ The biggest improvement in healthcare for everyone — not just women and minorities — is an investment in public health. We invest way too little in public health efforts, so there is an opportunity for high-health-return at a low cost per quality-adjusted life year added. Targeting public health efforts at illnesses common among low-income communities is really important. We also need to play around with different models of addressing mental health issues. I’m not convinced we have a good model for that. In terms of women in the field, I do think it helps to have career development program for women, such as CSWEP’s workshops that they host before conferences.

You graduated from Washington and Lee University in 2003 and got your PhD at Berkeley in 2011. Did you work as an economist that entire time? I see you published at the Federal Reserve Bank of Kansas City in 2005. What was it like working for the Fed?

I worked as an RA at the Fed, and it was a great experience, because I got to talk to other RAs who were also interested in regularly having great conversations about economics!

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