Earlier this month, I wrote about the impact of the tort system on flu vaccine availability in the United States. Interestingly, travel companies are now bundling flu vaccination with vacation opportunities in Canada. Fodor’s has an interesting story about the “Flu-Shot Ferry”, a round trip between Seattle and British Columbia selling for $105 with the flu shot included. The same story also links to an interesting Boston Globe article entitled “Business brisk as Americans stream to Canada for flu shots” which talks about the Flu-Shot Ferry as well as other flu vaccination/vacation opportunities available throughout Canada, such as a weekend plane trip from New York to Montreal.
Monthly Archives: October 2004
Prediction markets assessment of the Presidential Election
Today’s Wall Street Journal article entitled “For Math Whizzes, The Election Means A Quadrillion Options” provides an overview of the various quantitative techniques being employed by geeks all over the country who typically are tenured college professors who probably have too much time on their hands. Notwithstanding the barrage of criticism which has been leveled at the prediction markets (e.g., one commentator has described the Iowa Electronic Exchange Market as “college students playing with their lunch money”, and others have offered even more unflattering comments which will not be repeated here), I remain a fan and am looking forward to how the realized election results line up with these markets’ predictions.
Speaking of the prediction markets, the prices on the state-specific “Bush win” contracts offered on tradesports.com suggest that Bush currently (as of 10 a.m. on October 26) has a 19 electoral college vote advantage over Kerry; specifically, 253 to 234. The basis for this assessment involved allocating electoral college votes to Bush in states with “Bush win” contract prices exceeding $60, and to Kerry in states with “Bush win” contract prices less than $40. In my opinion, the states which are really in play are those with “Bush win” contract prices between $40 and $60. There are five states which fit this criterion: Wisconsin, Ohio, New Mexico, New Hampshire, and Minnesota. The following table lists the current prices for Bush contracts in these states, along with the number of electoral college votes which each state owns:
|
State |
Electoral College Votes |
10/26/2004 “Bush win” Contract Price |
|
WISCONSIN |
11 |
59 |
|
OHIO |
21 |
55.5 |
|
NEW MEXICO |
5 |
50 |
|
NEW HAMPSHIRE |
4 |
44.5 |
|
MINNESOTA |
10 |
40.8 |
If Bush holds onto the states with contract prices exceeding $60, a win in Ohio would put him over the top. If Bush does not win Ohio, he can still be reelected by taking Wisconsin, New Mexico, and New Hampshire. Kerry on the other hand, will not likely win the election without taking Ohio. Of course, various other permutations are possible. The prediction markets data suggest the possibility of a 269-269 tie in the electoral college, which would happen if Kerry wins Ohio, New Hampshire and Minnesota, while losing Wisconsin and New Mexico to Bush.
Certainly the quantitative models are interesting, and as indicated by the Wall Street Journal article referenced above, suggest that the election may very well be somewhat of a toss-up. However, there is probably no predictive indicator which has been as consistently accurate as the Weekly Reader poll. Since 1956, Weekly Reader students in grades 1-12 have correctly picked the president. As noted on the Weekly Reader website, “President Bush was a strong winner in the student poll; the only state Senator Kerry won was Maryland. Senator Kerry was also in a statistical dead heat with President Bush in New York, Massachusetts, Washington, D.C. and Vermont. President Bush won most grades, although Senator Kerry did win among tenth-graders.” Also, results by grade are shown on the Weekly Reader website, in case if you are interested.
Daily Times Series of Closing Prices for the PRESIDENT.GWBUSH2004 and PRESIDENT.KERRY2004 Futures Contracts
Today, the Tradesports website made high, low, and closing daily price data available for the PRESIDENT.GWBUSH2004 and PRESIDENT.KERRY2004 futures contracts. Below, I provide the graph of daily closing prices for the period August 11, 2004 (which is the first day that the Kerry contract started trading) through October 20, 2004.
"Infectious Politics" – article about the flu vaccine shortage in today's Wall Street Journal
Wall Street Journal, there is a very interesting and insightful article entitled “Infectious Politics” that explains why flu vaccines in particular and vaccines for infectious diseases generally are in such short supply in the United States. The contributing factors appear to involve a combination of price controls, regulation and tort lawyers. Of course, I made the latter point (concerning tort) the other day in my blog entry entitled “Impact of the tort system on flu vaccine availability in the United States“.]]>
“Infectious Politics” – article about the flu vaccine shortage in today’s Wall Street Journal
In today’s Wall Street Journal, there is a very interesting and insightful article entitled “Infectious Politics” that explains why flu vaccines in particular and vaccines for infectious diseases generally are in such short supply in the United States. The contributing factors appear to involve a combination of price controls, regulation and tort lawyers. Of course, I made the latter point (concerning tort) the other day in my blog entry entitled “Impact of the tort system on flu vaccine availability in the United States“.
Impact of the tort system on flu vaccine availability in the United States
It is well known that the U.S. tort system undermines incentives for U.S. pharmaceutical corporations to bring innovative, yet risky drugs to market. This is particularly apparent in the case of vaccines against infectious diseases, where the “tort tax” is by far and away the most significant cost component in the manufacturing and distribution of vaccines. With this in mind, it is interesting to consider the consequences for the United States of today’s decision by the UK’s Medicines and Healthcare Products Regulatory Agency (MHRA) to suspend Chiron Corporation’s license to manufacture influenza virus vaccine in its Liverpool facility, which in turn will prevent the company from releasing any of the product during the 2004-2005 influenza season. This doesn’t seem like it should be that big of a deal until one considers the fact that the United States was counting on U.S.-based Chiron Corporation to provide roughly 1/2 of its total flu vaccine for the upcoming flu season. Now that Chiron is out of the picture, the only supply source for flu vaccine for the entire United States is a French company called Aventis Corporation, and Aventis has made it quite clear that it cannot possibly scale its manufacturing to meet the needs of the United States during the upcoming flu season. (Fortunately for Baylor University students, faculty and staff, Baylor was prescient enough this past spring to contract with Aventis to provide an adequate vaccine supply this fall for the Baylor community).
Needless to say, it seems pathetic that only two (one U.S., the other French) corporations are willing to accept the risk of being sued for products liability by marketing flu vaccines in the United States. Unfortunately, this situation has created a serious capacity constraint which in turn has given rise to a potentially serious public health problem for the United States which is now looming. According to the Centers for Disease Control in Atlanta, GA, influenza typically accounts for as many as 140,000 hospitalizations and 40,000 deaths annually in the United States. Since these are the statistics which obtain under more “normal” (adequately supplied) flu vaccine scenarios, one can only wonder how many more thousands of people will likely die during the upcoming flu season because the highly dysfunctional US tort liability system has persuaded most companies to not bother with trying to compete in the market for flu vaccines!