hello everyone and welcome back to conversations with tyler today i am here with two harvard economists who have a new book out co-authored and the two economists are david cutler and ed glaser the new book is called survival of the city living and thriving in an age of isolation so it's about urbanism it's about the pandemic it's about
healthcare economics and much more first i will be starting with david cutler who is professor of economics at harvard david is well known as simply being one of the very best healthcare economists ever and uh david welcome well thank you very much for having me it's a pleasure to be able to see and speak with you here are all the questions i want to ask you about your work
to start why does education predict health above and beyond its ability to predict health behaviors and to predict income you know one of the great i was going to say great mysteries but one of one of the most important things that we've observed about the world is that people who are better educated are in better health and that's true virtually systematically and
it's increasingly so over time that is the gap between people with a college degree and people without a college degree is growing over time even as other gaps for example between whites and blacks are shrinking over time so there are a few different things that are going on at the sort of instrumental level in the sense of what what that affects health is happening
health behaviors are a part of it things like smoking and obesity so are things like environmental exposure so exposure to pollution is lower for higher ses people both by where they live in the country and even within a city by where they live stress levels seem to generally be lower for higher ses people relative to lower ses people and chronic stress has
a variety of adverse health impacts access to medical care is better for people with higher in higher socioeconomic groups relative to lower socioeconomic groups so all of those contribute if you step back even before those it's i think as a setting where society has really made it much easier for high income high ses people to be able to
engage in the types of things and buy the types of things that are associated with improved health so the nature of life the nature of where people live the nature of education the nature of everything is such that it's easier for higher income people higher ses people to do well and that um as i said sure even unfortunately so education seems to matter a lot yeah
it's also puzzling to me in your own work it matters more at younger ages so you would think the returns are cumulative it would really pay off when you're 67 because you've invested in a stock portfolio for decades but it matters most when you're young what's your best micro account of that one of the things that's super interesting is that for example uh
people who live in in cities where they're more better educated people smoke less even condition on your own education um and the same thing is true about weight and so on i think partly it's that people who i think it's probably that cities and areas are sort of run by kind of upper middle class folks often and so for example the environment is set up in
a way that's more conducive to health when you have more upper middle income people it's much more difficult to smoke there's healthier behaviors in general there are parks and things like that so i think part of it is just that society is shaped by higher income uh higher ses people and off that can be good for everyone who lives around those areas
to the extent education makes you healthier by lowering your stress and raising your relative status which is a possible hypothesis right what are the policy implications of that what should we do i think part of what we're learning over time is that social insurance programs are actually having a bigger and more sustained effect on health than we had
thought they they did so for example we've always thought of you know medicare and medicaid as being the primary social insurance programs that affect health but then there's research that the wic program women infants and children affects health that um food stamp programs affect health that tanf benefits affect health that housing policies can affect health
and you think that's through lowering stress as one mechanism as one mechanism i think it's through lowering stress i think there are many other mechanisms as well but what we've seen when we've looked more carefully at you know long-run data is that many programs really seem like they have a big impact over the course of the life cycle on people's health
and so i'm a big believer that one way to improve health is to help make sure that social insurance programs are reaching everyone they ought to and are and are doing it in the best way what do you think is the health value of google either positive or negative it's the busiest doctor in our country right how do we assess that oh absolutely one of the uh so so
information technology is dramatically changing how people interact with the medical care system my i haven't seen a formal study on this but my sense is that uh dr google has actually been pretty good for health because now you can find out things about you know where can i go to get a covid test or what about flu shots and so on so i think for for many people who have
difficulty finding a doctor that is uh and interacting with the medical system that is very helpful i will say though that for example if you look at um let's just take the anti-vaxx community you say well you know maybe if the anti-vaxx community spent more time googling the cdc website they would not be anti-vaxxers that actually turns out to be incorrect
that the vast bulk of people who are prolific in the anti-vaxx community know exactly what the cdc says they just don't believe it so so it's not that dr google will solve all the problems but i think for some people it can be quite helpful does that positive side show up in the numbers anywhere i haven't seen a really good study that's looked at you know access to the
internet and health but one particularly good thing that's come out of um the covid pandemic is that now um telemedicine seems firmly implanted and that's really a result of improvements in i.t and stuff so your ability to see your doctor online has really been a blessing to a lot of people and so it's not exactly google but it's of the same spirit
if you could have new data to study one question in healthcare that so far has been hard to study what would that be well i think you hit on the big issue at the start which is how do you take people who have difficulty interacting with the medical system and for whom society has been somewhat unfair and at least try and improve some aspects their health their economic
circumstances but we'll stick here with the health component how do you reach people for whom society's opportunities have not extended as much and and do what you can to make their health be better what do you make of the latino life expectancy paradox so latino immigrants come to the u.s often not speaking english not well connected at all
they often outlive people who are born here but their descendants do less well you're sort of presupposing that it's about the people not being well equipped to handle ordinary america but latinos seem to show the opposite trend yeah although the latino immigrants so first off there's a little bit of selection in terms of the latino
immigrants but in part also they bring behaviors that are typically from the countries where they are and then second generation will be more like americans and so on in terms of smoking and obesity and a variety of adverse behaviors like that so i think that um the closer you get to americans the more you look the closer you get to native americans the more you
look like native american health issues and then there's a mix depending on the health behaviors that one brings from the country where you are from some of which are favorable some of which are less favorable now you've written some of the best known papers on obesity and put forward the hypothesis that rising obesity is due in part to food preparation being
quicker and easier if that's true why don't diets work better because food preparation lowers the relative price of eating but if you just target the quantity directly by dieting it seems that most people don't lose weight by dieting why it'd be odd for the price to matter but the quantity not to matter i have puzzled over this a lot so what i think is happening is that
it plays into our inability to delay gratification for periods of time so everyone so what people say including myself very frequently is i'm going to start dieting and exercising tomorrow or next week and if i really am going to start dieting and exercising next week then it really doesn't matter what i eat this week because everything will be fine
the difficulty is that next week i'll say the same thing about the following week so people have a very short term horizon where they have difficulty understanding that if i don't do it this week i'm not going to do it next week and then i'm not going to do it the following week so we could take all the time we've saved on food preparation and cleaning
we could devote some of that time to exercising we could work off the additional calories and still have time left over so as a society we could do that but we don't do that i think in part because every week we say yes i'm going to start that next week why is obesity such a big problem in rural mexico say chiapas i mean we know why like they drink too
much coca-cola but structurally why is that the case in terms of relative prices so um what's happened in a lot of countries is as they get richer they adopt more of a western diet particularly a u.s diet so you adopt a diet that's high in corn syrup and fast food and salty foods and things like that you observe this in parts of rural mexico when there's some income
you observe that a lot in islands in the pacific that all of a sudden had mineral wealth and then so people are sort of endowed with a lot of money and then one of the things that they do is they eat their diet changes to a western diet and so you have in some of these islands you have you know 70 or 80 percent uh obesity rates and all the diabetes that
comes along with that same thing in parts of mexico where again the diet has changed very rapidly to a u.s type diet and with it comes u.s type type health problems what do you make of the data that suggests both pets and even lab animals are growing fatter food is much cheaper right so we can afford much more of it but lab animals we control what they eat right
there's some kind of regimen and this obesity seems to be rising in cases where relative prices facing humans are not obviously the culprit is it that people are buying more cat food and labs are spending more for their rats it seems odd yeah i don't know quite about the labs i presume that that they're feeding them more since my guess is the exercise is uh is
controlled um and there wouldn't have been genetic change that rapidly um it could be that components of the food are different as well that is you know to a first approximation what matters is total calories in but there are probably types of calories and in combinations of calories that lead to more or less weight gain it also depends on what time of day one
eats and a variety of other things like that too what do you think of the i call them the residual theories that there's something unknown in the environment it could be a chemical something in the way we live that's causing obesity levels to increase and we just haven't identified it yet do you take this seriously or they just made up stuff so i do take it
seriously as a as a theory absolutely and one of the things that um i think the literature has not been as good at as it could be is the impact of the environment not just the environment in terms of green space and you know ability to walk on streets but in the impact of the environment in terms of pollution and exposure to various substances and what that may then do
to health you know things like you know go back always it took a long long time to figure out what it was in tobacco that led to cancer and heart disease and so on because there are just so many things out there and you don't really know about in all the combinations and what's being burnt and so on so as theories i absolutely think they're important i don't at you know at
the moment i don't feel like there's i don't know of enough evidence to say you know for certain these are some of the things that we need to to worry about um there's been much more on the sort of pollution end with respiratory disease where there's seen where there's obviously very good link but also things there have been recent hints about
dementia and alzheimer's disease in the elderly so i wouldn't be surprised if some of these environmental factors turn out to be bigger than we had thought but i don't have a anything yet that i look at and say okay this is obviously definitive on this point why is hospital price transparency so hard to achieve so we've passed laws good laws in my opinion the trump people
were for them and doubled down on the issue when hospitals don't do it they get a slap on the wrist maybe they sent a letter in the mail voters seem to like the idea why has that been such a tough slog it was one of the the very few things that the trump administration did that i i really enjoyed and that i give them credit for was their attempt to push
this everything that we know in healthcare is that people have difficulty choosing on the basis of price and quality um and it goes back a little bit to some of the behavioral issues that we were talking about but i think it's slightly different if you go to the doctor and the doctor says you should take you know medication x and you go to the pharmacy and the
pharmacy says that'll be thirty dollars a fair number of people will walk away and say i don't have thirty dollars now what we would hope they would do is go to their doctor and say doctor is there any way that there could be a cheaper medicine that might work because 30 is kind of hard for me this month in practice people are extremely
uncomfortable doing that they really don't like to go to their doctor and say doctor you know how do i trade off the money here versus the the medicine and so as an as a result they wind up not taking the medicine and then they avoid the doctor because they're ashamed to admit to the doctor so people really don't like the money being involved in
the medical care part and they're also very afraid of the quality part of having that quality discussion so for example before you'd buy a tv you'd look up and see you know what are the different characteristics and so on but yet before you do surgery people rarely look up you know how good is that surgeon and what's that surgeon's record and what questions should i ask of that
surgeon they'll ask it of the tv they'll ask it of the refrigerator but they will not ask it of the surgeon nor will they ask it of the referring doctor they won't say doctor are you sure this is the right person and so on it's almost like they they don't want to put that doubt they don't want to say look i'm not sure you're the right
person or this is the right thing for me so the net effect is that when these data are out there they just don't get widely used hospitals don't want to put it out there because they don't want to be compared and if the patients are not going to complain that much they say fine i'll just do the minimum possible sometimes i won't even comply and there's no burning
need for me to put that information out there how do we explain the cross-sectional variation there because i agree with what you said but if i look say today at the vaccines there are really quite a few americans who obsess over morderna versus pfizer or this versus that so maybe some of what they think is wrong but they spend enormous amounts of time
on social media consuming information about vaccines they don't seem to be put off by nervousness yet when it comes to the brain surgeon there's nothing right very hard to find out anything and that's endogenous because in part the demand isn't there what what accounts for that difference you can sometimes get people to do shopping so where people have time and settings
and it's a very clear choice you can get them to do some shopping um particularly if they're also they're not people involved it helps if it's a pill and not a person who you're deciding you know between yes or no and where you don't feel like your doctor has a stake in it you know where something like that so that's you know ironically on the
vaccines people mostly decided on their own without a doctor's recommendation as to which one they wanted so therefore they would go online and decide you know which of the different vaccines do they want um so sometimes you can do that the other famous example where you can do that is thing uh for example in vitro fertilization where the records of the different
centers do seem to matter that is people will go more to the centers that have a good record because you know families are thinking about which centers should i go to and and stuff like that for other things particularly when you know it's a surgeon who you feel like you might be offending or it's a conversation with your doctor that you don't feel comfortable with
then people are extremely loathe to do that so i i would say that in some settings you can make it happen but oftentimes you can't why don't we have more paying for health care outcomes i give my doctor a bonus if i stay healthy for instance more complex ways of doing it using intermediaries collective contracts but there's very little why
as you know i wrote one of the books that i wrote really has a lot about paper performance first off we've had the past decade particularly the past five years or so there's been enormous experimentation with it so there's been quite a lot of paying for outcomes in not in massive ways but in reasonable ways so for example the accountable care organization
movement that the federal government does for medicare and that most private insurers do some of and that many state medicaid policies do that is very much involved in paying for performance and when people do bundled care arrangements like i'll pay you a fixed amount for a knee replacement they'll always have quality indicators in there and for primary care doctors contracts
that are sort of fixed contracts like we'll give you a certain amount per patient per month those often have quality indicators in there so they're in there but they're not um used as as extent they haven't dominated as extensively as people would like the evidence on them is that they are effective in that when you put them in quality improves costs stay the same or decline
so as best we can tell they're very effective they're not they've not turned out to be absolute total game changers so it's we haven't yet found the thing in healthcare where we say if you do this you will save 15 percent on dollars and quality will go through the roof and if you were to express that in terms of the model like what's the limitation
in economic terms something we can't measure something that's not contractible or what i think there are a couple of parts so one part is that every individual insurer has their own system and so the the doctor can't find it very difficult to customize what they're doing to every single doc every single insurer so they get one set of incentives from medicare
and another set of incentives from their blue cross policy and another one from the united policy and even within blue cross it varies depending on which plan you're in so that's one is that it's very difficult when it is so diffuse and i think the second one is that many of these are also coupled with systems where you can make more by
making sure your patient appears to be sick and therefore when they turn out okay you get a lot of money and so a lot more effort nowadays is put into making sure you're coding appropriately so that you get all the reimbursement for the sickness of the patient as opposed to saying okay the patient is what the patient is and the way i make money is by making sure they're
healthier in principle you could have doctors do both of those both worry about the coding and about the patient health in practice there's much more effort put into the coding part which has kind of got a real easy return to it than there is put into the health improvement part if we think about very wealthy individuals who could afford you know
any scheme and really care about being healthy and they have some form of concerns medicine and possibly even a buyer agent working for them i mean what do those incentives look like or what should they look like i think for everyone there should be a fair component of performance-based payment um i think it would be better if we made it easier to judge them so for
example we use things from electronic medical records rather than doctors have to write everything down on pencil and paper and so on i think it would be better if there were more coordination amongst them so that everyone is in essence rowing the same way or that everyone in the orchestra is playing the same music as opposed to people playing different
pieces of music and expecting to hear it go well but then you know that what people want from the medical system is to be healthy and anytime you're not paying for what people really want somehow you're going to run into trouble but let's say you david cutler you have 100 billion dollars right and you've hired a team of doctors to look after you what kind of contract do you write
with them you've thought about this more and better than anyone so what what would you do so the the kinds of contracts that based on the literature i think would be i think our best are you you get paid a fixed amount for caring for the person person so you know so a per member per month fee for caring for for the person if you have an episode of care there's a
fixed payment for the episode so that encourages coordination across the episode and there's a lot of outcome measurement so that you can say if you really do a good job caring for the patients or the patient then you're going to earn a lot extra and you would hire a third party to assess how well your doctor had done because the literature is not mainly
based on people with 100 billion dollars right so you're designing something from scratch with extra resources yeah although there are metrics out there that you can certainly use you know most conditions there are reasonable metrics that if you put them together the docs are generally happy with they're not perfect so i think one could do pretty well by
that and if you captured a lot of the doc's attention you know like for example the way that you you that you do better you know if you look at organizations that do really well they go the way the organization does it is they go to the doctor and they say the doctors as a whole and say look this is how we're going to practice here we're going to we're going to do images
in this circumstance we're not going to do them in this we're going to do this in the circumstance we're not going to do it here and then if the doctors say but that's not the way i've been practicing you go to them and you say look here's the literature here's the stack of articles that shows that this way is best now go ahead read through
them and if you want to talk about them and you don't believe they're right let's absolutely have that conversation but until we agree that there's something better this is how we're going to practice so it's really so it's sort of like the whole organization is invested in doing the right thing and then it sets up its systems and processes so that it's all
geared towards the right thing now as you probably know from 1950 to 1990 american youth suicide rates tripled why did that happen and they've gone up since then at various times suicide rates are an extremely unfortunate uh poor outcome um and they've also been going up recently particularly more among middle-aged folks but also among younger folks as well
so i've i've done as you're alluding to i've done some work on on suicide there are i think a confluence of different factors i think if you will on the demand side there is pain of various forms and there's demand for pain relief so pain can be physical pain it can be mental health impairment it can be despair i'm putting those all together as being pain
and then there's on the supply side the ability to carry it out in the case of suicides it's access to guns guns are typically particularly for men how men go about killing themselves ready access to methods of acting on pain very very rapidly in other cases people will take opioids or they will overdose on other drugs um again the more handy they are the
more of that that occurs not all of those are rational decisions sometimes it's just an intense response to pain and the need to self-medicate the pain that sometimes goes awry or sometimes it's just i can't handle it and death looks good now so i think it's both on the demand side and the supply side and it varies for different types of things my sense is
what's true about kids is not necessarily true about people who are dying of opioid addiction where i put a lot of weight on the supply side and less on the demand side there how strong do you think is the evidence for the twangy hypothesis that right now iphone addictions are causing isolation anxiety mental illness in young people is that just two time trends in tandem
or is there actual evidence that's true so it's obviously uh time trends the question is the evidence and i haven't been through the evidence uh thoroughly enough to have a firm view um i know there are people who believe that it's causal but i myself don't have a strong view as to what extent it's causal versus correlational now in 2006 you wrote a famous paper why
americans smoke less right and you argue it's because they better understand the health effects of smoking now since 2006 anecdotally i observe western europeans smoke much less than they used to is that because they've acquired a similar understanding or for other reasons you started this off in one of the most amazing places which is that you know 40
years after the u.s surgeon general conclusively demonstrated that smoking was bad for you 50 years after it really was known that smoking was bad for you americans had cut smoking in half and people in western european countries had not how can that persist like what and it's not that you know in germany they had no idea that smoking was bad for you
and so on but or in france or anything but in part it's um this sort of social norms and the peer type influences and that shows up through public policy as well so in the u.s we have periodically raised taxes on cigarettes we have put in restrictions where you cannot smoke in inside buildings you can't smoke in public places and all of that discourages smoking a
lot and if you don't have that you know smoking is also social activity so if your friends are smoking and you don't have restrictions on where you can smoke them people are more likely to start smoking and continue smoking so smoking i think displays even though it's a sort of individual act it displays a lot of these external consequences these external effects and
they hit very much sooner in the us than in other countries that is people in the u.s really responded quite rapidly and it took people in other countries a longer period of time for that matter it also took for example youth in the us a longer period of time so if you look youth smoking it was rising through the 1990s until the late 1990s with the master settlement
agreement between the tobacco companies and the the states and all of a sudden all this information came out about how the tobacco companies were lying to people and they were pretending that they didn't know smoking was bad even though they knew smoking was bad and that just turned off so many people particularly younger people that youth smoking has
begun a two to three decade decline since then so you can have these sort of social the the sort of the pure effects if you will writ large of information can be um long can be ongoing and have huge impacts and i think that's what we're picking up between the us and other countries now turning to your book with ed which again is survival of the city just
coming out putting aside anti-covert measures which we're all familiar with but how can cities be made less contagious for disease in america so we learn a couple of things about about cities and contagiousness of disease one is that um poor health anywhere is poor health everywhere so i may be totally selfish you know i i you know go back to when when you
endowed me with a lot of income i may care only about myself and it until a couple years ago that meant i didn't have to care about the health of people in poorer parts of boston and now of course i do care about them but continuing the analogy now i really have to care about them so i have to worry a lot are people obese because obesity is associated with the spread of covid19
are people smoking because smoking will predispose to other types of illnesses are people iv drug users because that's going to spend spread hiv and that's going to mean that heroin is all over and so my kids are going to be exposed to it in school and so on are people using electronic cigarettes so all of a sudden i have to worry about all of that and i
think that that's both that has enormous implications for public policy in terms of what public policy needs to think about i also think that it changes the conversation from being when we think of medical care as being what's my policy towards doctors and what's my policy towards hospitals and so on we need to reinvigorate more of the public health
infrastructure what's happened over time is that you know as as infectious disease has declined we've spent less and less money and less and less attention on the public health system until basically parts of it collapsed in covid and we realized oh my god it's a bad idea to have a non-functioning public health system so we're going to have to rebuild that and
that's going to mean a lot more money but that's going to be essential in reducing the spread of infectious diseases so what's wrong with say the cdc so their budget in real terms has gone up quite a bit this morning that the day we're recording they issued a warning to americans not to travel to canada right which is literally insane
it's the biden administration now for some time uh you know i'm broadly libertarian skeptical about government even i was shocked when that happened like what's the model that explains how something like that can come about there are two different types of things sometimes there's just bad luck so for example the cdc's first test for kovid got contaminated
and it took them a while to figure out you know what was the contamination and stuff like that so there's just bad luck and then sometimes it's in it's sort of systemic in that an agency has kind of fallen apart or it's me it's not not sure about its mission or or anything else and then it's a sort of structural problem what's one of the things and i'm sure um
the libertarian in you wants to go there as well is i think in general it's a bad idea where all of the public health of the country hangs on one agency so that if that agency has bad luck or bad leadership or just you know whatever happens you know the power goes out then nothing can happen you know it'd be as if there were one hospital in boston that could do cardiac
surgery and if the doctor was sick that day i'm sorry we just can't do cardiac surgery in emergencies that day so i think in general it's just a bad idea when everything is stretched so thin that it's hanging from a thread i also think that you know i don't know about how it's functioning now i haven't done any any looking or reading but the agencies all
of the agencies of the public health system were so beaten down by the trump administration that good people had left it was difficult to do anything they were just getting you know stigmatized and they sort of crawled into bunkers and so on and it takes an enormous amount of time to recover from that sort of thing so the there can be enormous lasting harm
from even a few years or a few months of just completely awful policy now take a given family they're thinking about the health trade-off of moving to the suburbs what would you advise them what's the main cost what's the main benefit not manhattan but a large city moving from one of the top ten cities to an upper middle class suburb what's the health trade-off
so probably not much in the sense that most of their behaviors will be the same the exposure to infectious disease in general is higher within cities so if you look this was not true early on in covid19 but it's become more so which is that um increasingly it's you know it's sort of urban areas are easier to spread infectious disease because there's more close contact
you're taking subways things like that so i would um i would say probably on that count there would be a little bit less exposure on the other hand there are things like so one of one of the things i've always found interesting is that people say they'll be happier when they move to more space but when you actually ask them before and after they're not much
happier and the reason for that at least in part is that people get very stressed out by commutes and they don't realize how much they're going to be stressed out by that so they think about you know i'll have a nice lawn in the backyard and so on they don't realize that five days a week they'll be spending a lot of time in a car commuting so i would think that that
would be an issue for moving out to the suburbs which is um is there going to be a lot of frustration involved with and stress involved in some aspects of it that one hasn't thought about within cities are there high returns or low returns to making travel through the city easier so basically you would get people to the emergency ward faster if
they had a gunshot wound or a heart attack does that matter much or that's seventh order no that matters quite a lot um having um a well-functioning emergency system is extremely important just take one example um when the marathon bombings occurred in boston a few years ago the the number of deaths was very small i think it was two
or three deaths no one who made it to a hospital alive died and that was because the emergency system had practiced intensely how do you handle a mass casualty situation where do you get people to what do you do once they're there and so people who there should have been way more deaths than there were but it was because of the ability of the system to be able to
handle it that you went that we wound up doing better and so i think for um any city figuring out how to get um emergencies treated right away and to the right places and then having those places do the right thing are really is really important if we put aside the fact that you likely have personal connections where you live right now right as many of us do but
just in the abstract as you grow older where in this country would you most want to get sick the places so let me say i have to move from boston so i don't i can't really know very much um the sort of upper midwest has very good health care you know if you sort of think about minnesota wisconsin type area extremely good health care um pretty much across the board so
there's not like the gradients there are not as big as you'll see in other areas in terms of the care received they don't go wild on doing stuff life expectancy is high not all because of the medical care system but likely a little bit of it is because of the medical care system um there's more of a sort of social ethic to the system in terms of we care
about people and people as a whole and stuff like that so i would say that's probably where i would go if you forced me to move what's the risk that vips get worse care because they're over treated for some things reasonably high would those things be oh um uh excessive testing is a big one so for example excessive um you know what do you do psa testing
you know for for men potentially with prostate cancer it's not even recommended that you get tested anymore it's just recommended that you talk to your doctor about testing or excessive biopsies in people who you know would say women who have breast cancer or you know where you might suspect breast cancer what do you do after that after biopsy so it's um the sort of cascade people
talk about in terms of a cascade the first thing is never that bad but then it leads to the next thing and the next thing and so on if you look at you know people who go into a hospital with in uh we were talking about you know minnesota or wisconsin or so on versus in higher spending areas in the higher spending areas well gee we noticed this slight
little thing on your on your ct scan that's not related to why you're in here but maybe we ought to bring in the specialist to look at it well maybe we ought to take that out a little bit well maybe we ought to do this and so you wind up with this whole cascade of things that are completely unrelated to what was going on or only tangentially related that cost a lot but
are but um bring anguish and sometimes uh worse health outcomes as a result now as you know early in the 20th century recent immigrant arrivals to the united states clustered together fairly tightly in terms of living in the same areas often within cities that trend then weakens throughout much of the 20th century and in the last few decades it's
been re-emerging why is it coming back there's a a line of work that at least on the health end comes from um ann case and angus deaton and then a colleague arthur stone wrote a pnas paper uh proceedings the national academy of sciences paper last year where they argued basically that my shorthand is that education is the new race that we're learning to
how to dismantle some of the barriers that have existed by race certainly not all of them but some of them and that what's coming up is that education is increasingly associated with where you live what resources you have access to and so on and i think that may be some of what's going on which is that society is bifurcating along the haves and the have-nots based on socioeconomic
status as opposed to race and that the have-nots are really a large share of that population and you know the have-nots can't afford to live in silicon valley and they can't afford to live in the boston metro area and they can't afford to live in new york and so like if you look mobility used to be everyone moved to the high-wage areas
but now the high-wage areas have such high house prices that peop that nobody can afford to live there except if you're extremely wealthy so it's sort of people are getting compressed into areas where you know if you want to move you're getting compressed into areas where they're more lower income people as opposed to more high-wage stuff and i'm really quite
worried that society is becoming a kind of insiders game as opposed to a sort of situation where outsiders get to get to play as well we alas have time for only two more questions your book with ed survival of the city if you had to pick an area it doesn't have to be disagreement though it could be but simply something you and he see differently
what would that be of the topics in the book and where does that difference come from we had incredibly interesting discussions about um if businesses left cities because workers decided to move to the suburbs what would that mean for cities and would that be like mass terrible would that be not so bad and i had originally thought oh my gosh that would be terrible for cities if all
the jobs moved out and ed convinced me that my views were certainly way overstated maybe there was not nothing to them but certainly they were way overstated that you know just to give one example if you move ten percent of the people 10 percent of businesses out of cities a couple of things could happen one is that's roughly two or three years of
growth typical growth by business so within two or three years you're back to where you were or another thing that can happen is you can turn um commercial real estate into residential real estate and that'll make cities be cheaper for people who really want to live in cities younger people people who don't need a lot of space who don't care about a lawn and
so on and you know but people who really want to live close by other people so my so that's one situation where my view changed because of conversations that the two of us had just just fantastically interesting conversations last question to improve the u.s healthcare system if you could offer one non-obvious recommendation not so much on political agendas right now but
something we could do that would just flat out be better what would that be you know there's some uh there's so many things um that one thinks about um i would say the the be all and end all of health care is the money that's spent when you spend so much money you can't direct the system well you can't you can't insure people you can't invest in the kinds of things you want
so i would focus after covid i would focus first order on reducing spending and there are two areas that i would address upper uppermost in my mind the first one is certain pharmaceuticals that are way overpriced relative to what they deliver because of whatever gaming and so on and the second one is the administrative costs of health care that are absolutely
absurd that drive up prices so people can't afford it that frustrate people and doctors that make it be extremely difficult for people to get the care they need and don't do anything valuable so those are the two areas and i would show that once i could save there i could make the medical system be better and cheaper and then that would start
the ball rolling on everything else a real pleasure david cutler thank you very much and again david's new book with ed glaser is survival of the city living and thriving in an age of isolation it's been a pleasure to be with you thank you so much now we have ed glaser ed is professor of economics at harvard university and most importantly he is arguably the greatest
urban economist ever to have lived ed welcome thank you very much tyler thank you for that um distinctly over-the-top uh introduction but i'm very grateful let's start with a simple question so there's all this enthusiasm about cities and agglomeration benefits the pandemic comes along a lot of people transition to work from a distance and then we see
big measured productivity gains what has gone on there so it reminds us that in for many jobs in a static sense right you can do this long distance you can make things work and i think many of us found this right i mean we wrote this book in eight months over uh over the pandemic year uh distinctly away from each other partially because there were no
distractions and all that was was good um however i think we also need to recognize the limits of long-distance living uh the most important of those limits is just it's much less fun it's much less joyful but uh while it seems as if it's fine for static productivity it seems distinctly more more problematic for people learning and for
onboarding new talent and let me just give you two types of studies so one of which is the they have the call center studies which the father of that was the nick bloom paper which was a randomized control trial in china um a more modern version is done by uh our students natalia emanuel and emma harrington which looks an american call center both
of them find the same thing in terms of static productivity if anything it goes up right but the the workers who are go remote are much less likely to be promoted in both studies and one interpretation of this is that promotion means that in the call center work means that you actually are given the job of handling more difficult work more difficult calls now how would your
boss know that you were good at handling difficult calls if they weren't in the same room with you how would you learn how to do those difficult calls if you weren't around with around other people and so while the static productivity remains you lose the dynamic benefits of being around other people second piece of evidence right it comes from burning
glass technologies and new hires so even though microsoft tells us that its programmers were just as productive right overall new hires for for programmers were down 42 between november 2019 and november 2020. firms were clearly unwilling to take the same kind of risks of hiring new workers that they couldn't inculcate in their corporate culture or screen them
properly or do any of those other things and so even though measured productivity did did well during the pandemic right there were still lots of disruptions and in particular um you know many younger workers who came of age really lost out as a result of this so if work from a distance goes fine in the short run what's the cross-sectional prediction
about where it will persist in the future is it firms facing bankruptcy firms with immediate projects now possibly startups who will then later transition to all being together and one big happy family but they're afraid they're going to fail before then what should we expect so i think we should expect young workers to be more likely to be brought together young firms as
well right because you're very much at this learning creative phase i think the optimal work from home strategy is a couple of partners who are in an accounting practice and have decided they know each other perfectly well and are delighted to to zoom it in from from wherever they are so i think unquestionably working from home will
remain a part of the economy right and it may well be many workers end up spending 20 of their time working from home even if they're part of a generally full-time job but for younger workers for workers who are for firms that are just getting started i think you know being live is likely to um continue as being a major part of the work environment it also depends a lot
on what your home environment is like so if you're like us if you're sort of a middle-aged professor who's likely to have a a comfortable home office and maybe even you know not having kids at home anymore or certainly not kids who are crying all the time at home anymore right working at home is a lot more pleasant than if you're 23 year old and
live in a studio apartment in somerville or new york or london so which countries will benefit the most from this so if say a silicon valley firm can now hire top talent from mumbai or delhi and everyone's used to the zoom call even if most of the people in the home office are back to being together uh what's that going to matter for geopolitically so for sure this is going to continue
the rise of places like bangalore so the ability to connect over long distances helps really educated people within india it doesn't necessarily help you know the bulk of 1.1 billion indians right who are not do not sit with computers on on their desk are not going to be natural software programmers um in terms of uh you know in general you think education educated
areas will benefit from this more than less educated areas would i mean there was a huge educational digital divide during the period zoom right in may 2020 68.9 of americans with advanced degrees were telecommuting five percent of high school dropouts were telecommuting 15 percent of people who just had high school degrees were telecommuting right so the skill divide
on this is enormous and we shouldn't possibly think that you know in a world of sort of universal telecommuting that's going to do anything for the bottom third of the american skill distribution we should expect across cities that cities that are attractive and are natural places where you know educated people want to locate will do
well they may be in the u.s or they may be elsewhere so i don't think the model is that your silicon valley startup says oh just phone it in right but i do think you know you have eight people and you say boy we really love skiing why do we go to vail we really love beaches why don't we go to you know hawaii or bali for that matter so i would expect sort of a reallocation
towards high quality of life areas and high quality of life countries and this helps britain and ireland because of the english language or not cements english as a global language sure what i mean once we get past the chaos related to brexit sure why not i mean ireland ireland has is both a very attractive place to live and has lots of
great english speakers and is very technologically savvy now if i walk around paris london new york dublin almost any city you care to name i see beautiful older urban neighborhoods not everywhere but really quite a few of them if the city has not been bombed into oblivion but i don't see newly created wonderful beautiful urban neighborhoods really anywhere why
is that um i'm not sure that i agree with you um but certainly the older cities of this country have you know regulated themselves into stasis right so we don't get beautiful new neighborhoods because historic preservation is a completely binding rule in london in paris and in new york so it's just very difficult to change the neighborhood in a way that works
and in terms of newer neighborhoods more generally right part of the issue is that we always build our cities around the transportation technology that is dominant in the era in which it's being created and for most of the past 80 years the dominant technology has been the car which means there are lots of nice places for you to drive around in
america but there aren't that many new pedestrian neighborhoods for you to walk around but there's been plenty of buildings say outside of the central core of paris sometimes even in the paris region but all sorts of other parts of france and it's never beautiful french have an incredible culture an amazing eye highly sophisticated may be willing to sacrifice uh
cheapness for beauty and yet they seem incapable of building new beautiful neighborhoods whether they're walkable we have old people's homes which are completely walkable they're never beautiful nothing's beautiful so so i you know my father was an architectural historian tyler so i have he was a curator of the museum of modern art so i have a um a certain
feeling that we as economists are not necessarily the best judges of of the beautiful um so what's your view of like the center pompidou you think beautiful or not beautiful what's your view on renzo piano uh i think there are many excellent individual buildings right bilbao guggenheim there's a long list but neighborhoods is where we're falling
short not individual buildings renzo piano amazing some thor go all the way down the list but neighborhoods i don't see them uh how about uh barcelona the parts of barcelona that were built after the olympics that's a that's a perfectly walkable neighborhood and not a terribly unpleasant place great to live in not terribly unpleasant is a wonderful description of it that's
the best we can do we're so much wealthier it's crazy i don't get it it's it's an interesting question i i don't um and what about uh areas in asia are there no blocks and all of seoul is new there are no blocks in seoul that you find inspiring i like them i enjoy soul but the really beautiful parts of seoul seem to be the older remnants which are
not many at this point right so i will say one of my favorite architectural moments in boston is where h.h richardson's trinity church abuts against the hancock tower i love it i actually think that that juxtaposition is stunning and it's exactly when you get this dialogue between an architect of the past and architect to the present when really magical things uh happen
which global city of any age is most underrated for its beauty for its beauty again you want me to make beauty statements that aren't statements if we want to talk about the most efficient we can sort of all agree on uh singapore you know the last place now i don't know how underrated it is but the last place i saw you live right is a particular favor of mine which is
edinburgh yes maybe it's underrated or maybe it isn't but it certainly is spectacular i would say actually there are parts of glasgow which is definitely underrated but if you if you just sort of the physical bones of glasgow are magnificent i would say more generally like there are lots of american rust belt cities where the physical bones are fantastic
right you know parts of the south side of chicago not exactly a rust belt but you know the the buildings along the lake right a little bit too monumental not necessarily built on a human scale but stunningly beautiful in terms of the way that they work with the water right parts of detroit right old buildings where you you know old buildings meeting
from before world war ii where it really works uh as space unbelievably well even if the city is you know still facing the woes that detroit has faced for 70 years so your father was an architectural historian what did you learn from him about the economics of building that is fed into your work i learned nothing well the only thing i remember about my
father telling me was he hit a model of housing cycles which was not particularly rational but it was a model that said that you always started buildings during the boom which means you always ended up completing them during the bust which means you always ended up losing money on the buildings because you got the timing all wrong now i didn't know at the time how
to think about this there there's some truth to this i mean it's not totally wrong in terms of housing cycles but you know my my economics i learned from my mother who was a got her mba columbia and worked in capital markets for mobile for many years i still remember this sort of epiphany when she explained to me i still remember where it was on
third avenue between 63rd and 64th street she explained bertrand competition to me and it was like the most magical thing in the world of this idea of these two these two shoemakers as she told it who are competing on price and somehow whether you're getting down to the actual cost can larger cities succeed over the longer term with dysfunctional public schools
uh you know it's it is amazing how underperforming cities are for providing upward mobility for poor kids right it is the facts that came out of raj chetty and nathan hendren and john friedman's opportunity atlas um you know big cities do you know at the metropolitan area level density and size are both negatively associated with performance within metropolitan
areas density and proximity to the city center are both negatively performance with negatively correlated with upward mobility and there's a huge cliff right at the edge of the central city school district where if you get out of the central city school district you do much better economically and you're much less likely to be incarcerated as an adult
right this is the shame of our you know it's the modern version of lincoln stefan's the shame of our cities right the fact that we have had this problem for decades and have been unable to fix it and yes our cities managed to succeed despite that but you know it is i would say in terms of our new book the the part that i feel least hopeful about is uh the school problem which in
some sense one of the stories that we tell is that every you know every city is going to be every place is more vulnerable to natural disaster if it's existing you know social institutions are weaker but what's your political economy model of the persistence of that problem why doesn't the median voter in the city just fix that right they want better we all want
better schools you know i think it's it's very hard to change things because there are very powerful entrenched interests in schools and because schools are somewhat complicated and unlike policing principals cannot immediately tell teachers how to change their behavior whereas uh police chiefs can actually change what their officers do on a dime
right it's very very hard to get teachers to change and so consequently working change in the schools is incredibly hard now we could move much more radically to uh vouchers to have competition and i think you know in many cases that would be a great thing to do but it's been very hard to move that politically partially because of the strong opposition of the
teachers unions um you know one of the things that we push in our book is something more that feels more like wrap-around after-school summertime vocational training competitively sourced right pay for performance because you know when someone's a plumber without they've learned how to do the skills or not and so you can allow a full degree of competition and
you can do it in a way that completely bypasses the unions but um i've been on the edges of the school reform movement for you know 20 years now and it's hard to be very hopeful about it in part because the political economy is just so difficult because there are voters who really you know there are teachers who vote who are you know very anxious uh
not to see change even as they are often doing heroic work in the classroom themselves our cities as a result just population sinks so if you think if population shrinkage is a major problem in parts of the developed world obviously japan italy singapore south korea may maybe the united states uh and fertility in cities is below replacement level aren't cities a big
problem and our founding fathers were right we should be suspicious of cities they can't fix their own schools education's super important and uh they're taking away people you know which is also a fiscal problem many of our colleagues right tyler i i think i am actually with you that i actually am hit my heart a natalist so just to be entirely clear i i actually
and it's part of believing in agglomeration economies that i just like i just like having more people so um even if i weren't worried about social security and paying for itself i think each new human being on this planet is a new source of creativity that can work some kind of some kind of magic now it is absolutely true that our
that you know suburban living has often been a compliment to um uh to having kids partially because the space is cheaper and certainly that's you know that's that's a um uh that's always going to exist but if you think about it the part of the city cities that are really um detrimental to fertility i think it's got to be the schooling it's got to be
the people living in cities don't think they have access to great public schools unlike people living in suburbs which leads us back yet again to think that the most important thing going forward for this issue as for so many others is to improve the quality of urban schooling why does it seem that urban crime has moved upward again and at least possibly this seems to predate the pandemic
what's our best model of that oh um you know most of the the changes in crime are very hard to explain uh with very much right so um the you know i wrote a paper almost 30 years ago now called crime and social interactions that goes back to um observations that early 19th century french social scientists made that basically that the the existence of pure
effects in crime means that you just get lots of variation that's not very easy to explain um i think we shouldn't also though forget that it's possible that some of this has to do with uh changes in policing practices um the evidence on policing practices leading to the reduction in crime is actually pretty thin um most of the people who dabble in this
area believe that there's an elasticity of crime with respect to the quantity of cops that seems pretty strong and that comes from just you know various squashy experiments like throwing more cops in a neighborhood seems to reduce crime but the styles making a difference is much harder to tell there's a great paper by my colleague roland fryer and tanaya
devi that shows that after there were pattern or practice investigations of police forces that followed a viral incident of a police shooting that crime rates spiked enormously apparently because police stopped going to high crime areas when they came under investigation so i think that's the kind of thing that would make me very worried about things like defund the police so
while i think it's absolutely true that we should demand that um police treat every citizen with respect and we should have metrics that keep that under account and we should have a system of incentives for police chiefs that require this we certainly can't defund the police i mean we need in fact if in in general right if we're going to ask the police
to both prevent crime and to behave more respectfully to everyone that's going to require more funding for the police not less because i don't believe there's a free lunch here as i as i don't believe there's one anywhere else will nimby come to dominate the american southeast is that the political equilibrium everywhere once you get enough development this is the worry
tyler right so the beauty of the southeast has been it has been the land of free development where ordinary americans can buy a home at a reasonable price because you haven't fettered the developers and yet in place after place you know in in austin texas in central atlanta right we're seeing the nimby walls go up we're seeing you know more
and more barriers to tearing down and rebuilding so i'm worried about this um and i hope the answer is no but it certainly is something that um you know would be very bad for america if we stopped having at least some parts of america that make it easy enough to build so that ordinary people can buy housing at a decent price but if cities can't fix their schools
and can't fix their nimby problems and are super expensive and don't produce enough human beings isn't there a funny kind of second best offense of let's keep people out of the cities the nimby's okay keeps them in the suburbs better for them anyway there'll be a higher birth rate you need to have someone keep those cities going but kind of write them off a bit right maybe
they're just not fixable look remember i mean i'm an economist right which means that i like you i believe that the real desiderata is choice what we want is to make sure that people have options and for some americans they're going to want to live in cities and some are going to want to live in suburbs and some are going to live in low density rural areas
and that's just great right and we don't in any sense want to do away with any of that i don't want to give any sense in which um you know that's that's not at the heart of what i believe at the same time i think that cities are you know lots of areas are doing a crappy thing by making it difficult too difficult to build and i think there are social
welfare benefits by freeing up developers um and i think in general it's awful that cities aren't doing a better job with their schools and we should fight against those things right it doesn't mean that you know we're not doing it just so that more people will come to cities so that that would be the right be the result we're doing it primarily because the kids who
are going to those schools are getting a raw deal and we want them to get a better deal and i think in general one of the themes of the book is that america has done you know an amazing job over the last 40 years of protecting its insiders at the expense of its outsiders and schooling nimbyism are all examples of cases in which our cities have become
and our suburbs machines for protecting entrenched interests of you know middle-aged middle-class people and making it difficult for the people who come and start with less to find a brighter future what's your underlying political model of why so many cities especially coastal ones have become so politically clustered along some particular dimensions it didn't used to be this way
right so um you know the the the model that i have of this is about strategic extremism which i published in the qje in 2005 in the quarterly general economics in 2005. and so a lot of it has to do with that model emphasizes communication um and in that model you had um people clustering all along religion as opposed to other you know uh cultural dimensions
on on the right because there were people who were speaking to republican voters who had religiously oriented microphones by contrast the left tended to be more dominated by economic issues because the left had the unions and the unions were the primary communication device so that's a that's a model that emphasizes communication as the ultimate
determinant of the way that partisan divides occur so what do you predict is the final equilibrium is it self-reversing or does it just keep on going and going which could give you another reason to be skeptical of cities i don't think this is just cities this is this is a oh i mean i don't quite were you asking the question i missed you for a second about partisan divides
or about about geographic divides in partisanship well i think it's better for state cities if they have two political parties and the two parties compete no matter what your particular views may be so if cities don't give us this right isn't that another problem with cities and if they keep people out maybe that's not a terrible thing so so
i believe very strongly that some form of competition that's a major theme of this book right is that in fact cities are more vulnerable than ever even if face-to-face learning comes back right it's never been easier for people to leave the city and so treating your rich treating your businesses like they're a piggy bank is a terrible mistake now
often i would you know i'm a traditional east coast republican right tyler i mean i believe that there should be republicans in cities and in fact i often have been one so i think this is a very good thing to have this but i will settle for a robust pragmatic wing of the democratic party debating against a robust progressive wing of the democratic party and i think that's
partially what the book is arguing for is that you know city governments really need to be pragmatic because cities are vulnerable and unless they actually make sure that they're actually providing decent schools and safe streets and doing so in a reasonable cost effective way that people will just run away and unlike you i don't think that's a good
thing because i think that when our geographic movements are determined by political dysfunction instead of economic reality that's bad putting aside covet policy which of course is important but what else can we do to make our cities healthier um so uh in terms of the things we talk about primarily in the book are around housing and policing and schools which we have
already discussed we do not do a lot on the book on transportation um but i certainly joined the join the crowd of economists who have argued that congestion pricing is the best way to deal with urban traffic jams right there's no reason not to charge people for the social cost of their actions on this and giving away city streets for space for free is just crazy
um and especially since we now have technologies that can handle this and if we introduce autonomous vehicles without congesting pricing you have just lowered the cost of sitting in traffic which means the first order behavioral response is that more people will sit in traffic okay and our congestion will get even worse unless we introduce this to
the from the beginning so i think you know pricing is really good i think it's also key that we start thinking about you know we have new transportation technologies in a way that we haven't in a long time right so we have you know new autonomous vehicles and it seems to be very odd that we're still thinking that like the the right technology for
connecting cities is this 19th century technology of trains instead of envisioning you know single dedicated lanes for autonomous buses that go 150 miles an hour right this is going to be more flexible it's going to be cheaper it's a 21st century technology as opposed to a 19th century technology now i've seen the 1959 brazilian movie black orpheus set in rio de janeiro and
the hills are empty and the city is beautiful now if you fast forward to rio today it's a war zone right and it's extremely densely populated is brazil a good example of failed dmb policy no no i think that those favelas are providing upward mobility for millions and millions of brazilians i mean the overall track record of cities as a tool for turning poor farmers into
middle-class urbanites is phenomenal the one failure of brazil cities is that their police have failed right and that's the one failure that i would i would say and it is you know when you look at the failures of developing world cities and there are plenty i mean there are demons that come with density as you point it out right i mean there are you
know there's crime there's contagious disease there's traffic congestion right but the right answer is not to look at those and say oh better you just stay on the farm there's no future in rural poverty in these places right the right answer is to do battle against the demons that come with density but think of your own earlier paper on urban
giants from what 1995 so a major city can be too densely populated for rent seeking reasons so mexico city arguably is too large you'd rather have more people in monterey and guadalajara rio arguably is too large uh shouldn't brazil many other countries austria have a more even distribution of city sizes more like zipslaw which sometimes they don't have
i don't think there's anything normative about zip's law right so i think in general we should fight against the tendency to distribute extra rents to particular localities right that is certainly right and it was almost surely a good thing that uh rio stopped being the capital of uh brazil about 60 years ago and that those rents went to brasilia
which is now currently too large relative to its economic functioning because it's a political hub but i don't think that that you you can leap from saying oh we want to restrict washington's tendency to poor rents on washington dc you shouldn't then move from there to say oh i'm going to have a national spatial policy new york you're slightly too big chicago you could be 30
larger how are we going to know this we don't have any way a social scientist to actually know this exactly and we should resist any urge to try and micromanage the locations of firms and individuals if we think of the united states as you know in 1910 there's a high degree of immigrant segregation right people from the same country living next to each
other lower east side wherever that declines throughout most of the 20th century and now it's come back why is that why the change well immigration has come back right so we had a but even adjusting for numbers it seems there's more clustering well how you adjust for numbers is it's never entirely clear i mean remember i mean david and i struggled with this in our
you know 100 years of american segregation so it's it's very hard to know exactly how to adjust for numbers and it's also you know a question of of how linguistically distinct the immigrants are how educationally distinct the immigrants are um you know our view was that is that in general segregationism is more harmful the least educated the less educated the
group is and so we should particularly worry about the segregation of those groups that have you know less skills and you know maybe take policies to to fight against it although it's not clear apart from policies that ban outright housing discrimination which of course has been illegal for 50 years it's not quite clear what strong policies we have
for reducing levels of segregation within cities how dense should los angeles become i don't have a view about how dense it should be i have a view about how regulated it should be tyler and i think it should be less regulated and how dense would it then become what would it look like would it all look like culver city this is this is exactly the same point
as you know marty feldstein made starting in the 1970s is that for many public policy problems you don't need to know where you want things to end up because it'll never end up close to where you want it to end up right all you need to know is the right direction so i feel entirely confident given how much demand there is for los angeles given how productive los angeles is that
you know we should have more los angeles right i would have more homes in los angeles but whether or not that means ubiquitous skyscrapers everywhere or more duplexes i don't i don't know we're only likely to get the more the increase in duplexes i mean for example the california law um that was put in i guess a week and a half ago right not i don't know if gavin
newsom has signed it yet um you know that's that is allows much easier permitting for two unit projects right that's hailed as like a huge triumph because it makes it easier to build projects with exactly two units this is what we're actually talking about so i feel confident that i'm in favor of two unit projects and i think there are lots
of core areas in downtown la that would probably be well served by having some high-rise condos uh some more high-priced condos than they currently have as you know there are quantitative attempts to estimate the cost of nimbi policies most notably by moretti but among others but those attempts don't typically take into account the fact that the us is
uniquely bad at building cheap infrastructure so if we made new york san francisco la other cities much larger we would have to expand infrastructure but that's one of the things we're worst at to what extent would the potential gains from jim b dwindle if we take costly infrastructure into account i think it's awfully hard to i agree with you and the the in terms of the
cost of american infrastructure it's a shocking thing how expensive it is to build um in some cases for example you can expand if you expand density in core areas of manhattan many of those people can commute to work by walking and the sidewalks are not overburdened so those are areas in which you would not require huge amounts of extra
infrastructure uh to build and often you know if you think about the infrastructure requires environments in the center and on the edge it's not totally obvious that it's higher in the center than on the edge right in many cases you can take account of existing economies of scale um and in cases like los angeles where the gap between valuation and construction
costs are so large that you know even if you say you're going to spend on infrastructure twice as much as physical you know twice as much as physical costs you've still got a lot of social value that you've created by opening up a little bit how much right now are we exporting american poverty to american suburbs and are our suburbs capable of handling that
uh i don't i mean that's just not at all the way that i think um you know i but see there's some people who just aren't that productive they're priced out of cities they move to suburban or ex-urban areas social services are weaker the bus network doesn't work so well there's problems getting your car fixed at an affordable price and in some ways their
poverty problem has become worse and should we build suburbs to be better geared to handle people who will have low incomes i think it's it's ideally the the answer is you don't really want political or public policy based reasons to relocate now um but i don't have a view beyond that in that where i want poor people or rich people to locate i mean i think it's in general
it's it's a you know it's a matter for their individual choice um if you're telling me that it's much more expensive to deal with poor people in suburban areas it's something which i'm not totally confident that it is but certainly you know i believe that access to public transit is one reason why poor people tend to live in cities um
then maybe you want to lean slightly against suburbanization of poverty but this is an area which i would have very little confidence in terms of applying on any public policy whatsoever um just doesn't feel to me like you know i have a strong view on where people should live every day i get a spammy phone call someone wants to buy my house blackrock
more seriously is buying up a lot of housing is this a worry or is this just the market working it's not something i worry about very much uh you know i i don't necessarily see a market failure in here in any way or the other um what what do you think blackrock is going to do with your house are they going to rent it out or they're going to tear it down and build something even
fancier than than the cowan homestead if they're allowed to they would build a much nicer structure i won't do that because i have to worry about where do i put my things in the meantime and i'm focused on the short run right right so i'm not worried about it my worry is that no one wants to buy my house right that seems right so no i certainly don't worry about someone
wanting to buy your house whether it's a company or an individual no i mean i just didn't know if there was some externality you had in the back of your mind on this that i wasn't aware of but i i see given that i'm not hearing any i don't know why uh parking minimums how much do they matter maybe blackrock wanted to put lots of you know sewage treatment plants
in your in your area that we're going to spew particular things on your neighbors and maybe we might want to have a policy controlling that i don't know but some people say it'll be a new housing bubble some of it's like the airbnb complaints that you have buyers who then rent and there's a positive externality from homeowners that's possible right so i
don't dismiss those arguments i'm not personally worried but you're the urban economist right i'm asking you i i think the area was where you hear this most is when you get the absentee buyers in places like vancouver so that's that's when you hear that so you know you build these fancy towers and you know it's often used as an argument against new construction
we've built you know this sparkling new tower in vancouver or new york and it's just being owned by russian oligarchs who aren't even there now i usually say in response to this um you know if you tell me you're selling a you know 50 million apartment to someone and they're never there and you're unhappy about that i tell you you're not charging
enough in property taxes because by and large you've just actually made a huge amount of money on property taxes and you're not delivering any city services whatsoever so from the time like fear of like extra infrastructure this is ideal because these guys don't require anything because they're never there there's an old joke by the way in the real estate circle that you know one of
donald trump's clever ideas when he was a real estate developer was he and i have no idea if there's any truth on this was that he figured out you needed fewer elevators when your owners when your residents were mostly absentee so you could actually reduce the cost on elevators again i have no idea if that's true but if so it's clever um the um the
the one area in which i i do worry slightly about the tall buildings that aren't occupied is you know for someone who likes to make the case over and over again the way to promote affordability is to allow more construction right these an apartment building that has 10 apartments for oligarchs does nothing on that front you know so i still want it
because i want to tax them and i want to use them to fund city services but they're not actually a solution for any kind of affordability let's say we abolished all parking minimums how big would the gains be and are there potential problems from parking overflow uh not if you're charging for the use of city streets there isn't you know the problem is here we've have some starting
point which we think people should have the right to park any way they want for no cost or for some severely subsidized amount in a world in which city space is scarce you want to charge as much if not more so for parking in a slot on the city street is the person who has a structured parking lot charges for their space so i i think once you charge
people for their space there's no reason to impose extra regulations on free parking the overall quantity of social benefit uh you've got to ask the great don shoop for that he's he's the one who's written the book on the high cost of free parking let's say it's a suburban development it's tyson's corner someone wants to open some kind of big box store and you
tell them you have to have x number of parking spaces because otherwise people will park in front of homes and maybe there's some abstract equilibrium where all parking is charged for but practically speaking that's not going to happen right you know i am not very worried and in fact i don't think big box stores really need much of an incentive on this as
they seem to be pretty good at recognizing that their customers demand parking close by and they seem to be pretty good at develop imposing it on their own um yes if you are uh if you are repeatedly relying upon an action which inconveniences the neighbors you might want to lean slightly against that right but it doesn't feel to me like a huge first
order issue and certainly in city streets yeah we really can charge everywhere there's really no reason why this should be a single block in manhattan in which it's free to park right there's no there's no reason why you need that now some of your best known and most cited pieces they're from the 1990s and they're on institutions and legal origins
since that time how have you changed or developed your mind on those issues compared to what you thought back then i don't know i mean they're i mean that stuff is yeah that stuff is 1999 2001. i don't know that they've changed a huge amount i mean i thought more just about cities per se i think in lots of cases i'm you know i mean i think one of the one of the
mantras that i keep with me is in city government capacity is more important than policy so as academics we're very big on what's the right policy but in fact if you've got a mayor who has at most two people who will do anything that the mayor tells them to do it doesn't make any difference what policy you tell them uh or her because she's not gonna be able to get it done
so understanding the institutional restraints that particular leaders have is a big deal um i am i mean i've spent a lot of the past five years at least pre-covered worrying about cities in the developing world um their institutions are quite important and i certainly have the view that cities are one of the places in which we actually get better institutions i mean
one of the stories i tell in the new book is the you know the urban fights of the 19th century to deal with contagious disease and this was a moment in which sort of urban upper middle class civic leaders came together to fight for sewers to fight for aqueducts right and in some sense this is the moment which government stop ceases from being just
an agent of death i mean it's a bit of an exaggeration to say governments pre-1800 were essentially only agents of death but it's only a small exaggeration to say that right over the course of the 19th century governments actually start doing some good and most of it's involved in delivering sewers and fighting against contagious disease in
cities and developing the institutions that went along with that infrastructure was a big deal if we look at say latin america maybe quarter chiba monterey would be some of the more successful cities what is what is city success correlated with institutionally in latin america usually it's correlated with with so i have rarely seen things that are good
quantitative studies i mean i can tell you things that i certainly seen in you know uh monterey um you know the the medellin story is amazing if you think about medellin going from you know the the city of pablo escobar to today a lot of it often has to do with relatively pragmatic business leaders who wanted a safe and competent public sector that could enable their
business growth so i think that's a lot of the monterey story monterey also has a very empowered university right that is highly competitive as well that i think has been partially a force for good there's a story that i've heard that i've never been able to independently confirm but the role the business community coming together to fight crime in monterey to
fight the gangs which you know if true is sort of an amazing tale and the business community also played a role in terms of crime fighting in colombia as well do you hold out any hope for charter cities like prospero and honduras can that work or is it futile i think it's very hard for governments to keep their hands off the golden egg so you know the beauty of hong kong was
it had the british navy protecting it for most of its history and so there was no way that china was gonna or anyone else was gonna grab it um but it's very very hard and i think the the you know the story in honduras shows that um that you know it's very very hard for a country to say oh we're going to have this different jurisdiction run
the city and it's going to be much more successful the rest of the country and we're going to think that that's okay it's just very hard to see how the populist political dynamics don't cause it to come unraveled but it's worked for uae right so dubai is massively successful the uae allows it to continue yeah but the rest of uae is incredibly
rich too i mean you at uae is just i mean i don't think generalizing from uae is very easy tyler i i think it's but it it's not wealthy only because of oil right it's a banking center service center so someone let that happen uae could have gone much worse under our normal rent-seeking institutionalist story and it didn't so if there's hope for uae is there hope
for charter cities or is there some difference that makes one more plausible than the other there is always hope but everything is easier if you have trillions and trillions of dollars of oil wealth but it's also harder right there's a resource curse if you're not norway uh the resource curse seems like a negative i think there's a level at which my view
is the research curse tends to be in the intermediate levels that once you have just an unbelievable amount of wealth it tends it tends to be much less of an actual resource curse will there be a new major american city started in this century assuredly but i have no idea where let's say you're investing where would you put your money i think there's a lot to like in the
highly educated pro-business cities of the south so i think i think that i mean traditionally this was austin again i worry about nimbus in austin but i think the places that combine education right i mean atlanta is about as well educated as boston is so you know it's um but on the other hand they just have a very different atmosphere towards free enterprise than
boston does so those are the things that i think of as being really powerful and they have you know uh because they've embraced a certain amount of economic freedom they make it a lot easier for ordinary people to buy housing so those are always i mean i basically have a two-factor model of economic growth dollar i mean my model is always it's
about education and it's about institutions that are relatively pro free market relatively pro-business so can miami become a tech hub they have a bunch of schools you might say none are quite top-notch uh sympathetic mayor right sure uh it's certainly possible uh you know there appear to be certain weather issues with miami which i'm not going to
have any strong views on but they're doing these earthquakes in san francisco they're surrounded by raging fires right they're in a desert the colorado river is problematic so why not be more vulnerable to predict the climate but yes and there's a lot to like about being you know this this hub that's connected to all of latin america right of course but you don't sound on board i i
you know i i'm i don't think at all it's impossible i'm just not uh i'm just resisting the urge to to be to be confident about this putting aside boston and cambridge which are doing great what can the rest of new england do to stay vibrant you know the same mantra as every place else attract and train smart people and get out of their way
but won't they just leave for boston and cambridge no there's this i mean anyway the pandemic has been good for low density new england in terms of of quality of life um you know you need a little bit less regulation in lots of spaces you need a little bit you need to make it easier to make fun in these areas to be an entrepreneur of entertainment uh which
means starting restaurants bars food trucks etc it's hard the further you get north i mean the climate is a is again a you know holding a detriment in in parts of maine or parts of northern new hampshire but i think most of new england's doing pretty well now we're almost out of time but two closing questions and this one i asked david also if you take your book with him survival
of the city living and thriving in an age of isolation i'm not necessarily looking for a disagreement though that would be okay but an area where you and he still see things differently in the book from the book what would that be we he has still not convinced me on single-payer healthcare so i think that's um uh that that's certainly a we do not say
anything about that deliberately um so that's that's an area in which we um uh certainly have not yet come eye to eye and i should say like he's a great expert on this and i'm not so i'm not trying to convince anyone that he's wrong i'm just saying that he's not yet in in 30 years of our friendship he has not yet persuaded me on this um and uh
i don't know if we actually differ on the weight that we would put on security versus respect of the policing i'm not totally sure about that i'm not sure that he's on board for you know every bit of my gung-ho let's permit every um uh let's permit every every new business that we can oh i would say okay let me take this in in the work in our work on obesity and our work on opioids
um i am still less comfortable with the view that you know you're to have paternalistic policies that really push people to be thinner than they currently are i i am never going to be as comfortable with that as despite the fact that i agree strongly that american obesity is you know one of the health problems that make covet so difficult here
last question what will you be doing next i am uh going to be serving as the chair of my department and enjoying all the fun of administrative meetings on end for the next three years ed glaser thank you very much and again ed's book with david cutler survival of the city living and thriving in an age of isolation thank you so much for doing this tyler very much appreciated