Christmas Decorations

Richard Epstein makes a compelling case for the Big Drug companies, but falls short of engendering real belief. He makes much of the compacted time during which Drug companies can recoup their outlays for R&D. Patents awards last the full term from Date of Issuance of the patent. He tries to justify the immense Sales staff used to persuade Doctors to proscribe their Products, undoubtedly overlooking the data that Doctors are over-medicating their Patients; on the order of Six times the Proscriptions to their Patients, as was being done in 1960 (best free-fall Time prior to Medicare and Medicaid). He criticizes FDA regulation, even after widespread condemnation of lax FDA policies threatening the Public has come from Doctors, academic medical Researchers, and from within the FDA itself. Drug manufacturers are even well-known to discontinuance of Drug lines of high importance, simply because their Patents had run out, and they would not compete with the lower Profits of generic supply. Thanks to Greg Mankiw for the Pointer.

The New Economist has a Post and link to a Paper by Bordo, Erceg, Levin, and Michaels. It sounds like a relatively important Paper for Those interested in the area if they have the time to read it, which I don’t. Their concept of gradualism in monetary policy, though, undercuts the purpose of the policy in the first place. Shedding inflationary profits cannot be accomplished without loss of Book asset worth; gradualism would leave such worth unaffected, and inflation will not be cut. The gradualism, itself, would suppress Operating Profits, leading to long-term minimization of economic performance without suppressing the inflation.

Tyler Cowan tries to rationalize Christmas decorations. He is probably quite accurate in his assessment of the motives of Retail business at least. I personally detest those advertising ploys (such as having popular radio stations play nothing but Christmas music–grrrr). I wonder at the number of extra trains of coal required for the additional lighting (this is supposed to be an economic blog after all). I imagine the real purpose of early pressures for Christmas lies in Retail desire to foster guilt feelings in Customers who dream of a moderate Christmas with modest expenditure. lgl