Essays on the Role of Government Incentives in the Private Provision of Social Goods

The economic rationale for public intervention into private markets through price mechanisms is twofold: to correct market failures and to redistribute resources. Financial incentives are one such price mechanism. In this dissertation, I specifically address the role of financial incentives in providing social goods in two separate contexts: a redistributive policy that enables low income working families to access affordable childcare in the US and an experimental pay-for-performance intervention to improve population health outcomes in rural India. In the first two papers, I investigate the effects of government incentives for providing grandchild care on grandmothers’ short- and long-term outcomes. In the third paper, coauthored with Manoj Mohanan, Grant Miller, Katherine Donato, and Marcos Vera-Hernandez, we use an experimental framework to consider the the effects of financial incentives in improving maternal and child health outcomes in the Indian state of Karnataka.

Grandmothers provide a significant amount of childcare in the US, but little is known about how this informal, and often uncompensated, time transfer impacts their economic and health outcomes. The first two chapters of this dissertation address the impact of federally funded, state-level means-tested programs that compensate grandparent-provided childcare on the retirement security of older women, an economically vulnerable group of considerable policy interest. I use the variation in the availability and generosity of childcare subsidies to model the effect of government payments for grandchild care on grandmothers’ time use, income, earnings, interfamily transfers, and health outcomes. After establishing that more generous government payments induce grandmothers to provide more hours of childcare, I find that grandmothers adjust their behavior by reducing their formal labor supply and earnings. Grandmothers make up for lost earnings by claiming Social Security earlier, increasing their reliance on Supplemental Security Income (SSI) and reducing financial transfers to their children. While the policy does not appear to negatively impact grandmothers’ immediate economic well-being, there are significant costs to the state, in terms of both up-front costs for care payments and long-term costs as a result of grandmothers’ increased reliance on social insurance.

The final paper, The Role of Non-Cognitive Traits in Response to Financial Incentives: Evidence from a Randomized Control Trial of Obstetrics Care Providers in India, is coauthored with Manoj Mohanan, Grant Miller, Katherine Donato and Marcos Vera-Hernandez. We report the results from “Improving Maternal and Child Health in India: Evaluating Demand and Supply Side Strategies” (IMACHINE), a randomized controlled experiment designed to test the effectiveness of supply-side incentives for private obstetrics care providers in rural Karnataka, India. In particular, the experimental design compares two different types of incentives: (1) those based on the quality of inputs providers offer their patients (inputs contracts) and (2) those based on the reduction of incidence of four adverse maternal and neonatal health outcomes (outcomes contracts). Along with studying the relative effectiveness of the different financial incentives, we also investigate the role of provider characteristics, preferences, expectations and non-cognitive traits in mitigating the effects of incentive contracts.

We find that both contract types input incentive contracts reduce rates of post-partum hemorrhage, the leading cause of maternal mortality in India by about 20%. We also find some evidence of multitasking as output incentive contract providers reduce the level of postnatal newborn care received by their patients. We find that patient health improvements in response to both contract types are concentrated among higher trained providers. We find improvements in patient care to be concentrated among the lower trained providers. Contrary to our expectations, we also find improvements in patient health to be concentrated among the most risk averse providers, while more patient providers respond relatively little to the incentives, and these difference are most evident in the outputs contract arm. The results are opposite for patient care outcomes; risk averse providers have significantly lower rates of patient care and more patient providers provide higher quality care in response to the outputs contract. We find evidence that overconfidence among providers about their expectations about possible improvements reduces the effectiveness of both types of incentive contracts for improving both patient outcomes and patient care. Finally, we find no heterogeneous response based on non-cognitive traits.

A Randomized Phase II Crossover Study of Imatinib or Rituximab for Cutaneous Sclerosis after Hematopoietic Cell Transplantation.

PURPOSE: Cutaneous sclerosis occurs in 20% of patients with chronic graft-versus-host disease (GVHD) and can compromise mobility and quality of life. EXPERIMENTAL DESIGN: We conducted a prospective, multicenter, randomized, two-arm phase II crossover trial of imatinib (200 mg daily) or rituximab (375 mg/m(2) i.v. weekly × 4 doses, repeatable after 3 months) for treatment of cutaneous sclerosis diagnosed within 18 months (NCT01309997). The primary endpoint was significant clinical response (SCR) at 6 months, defined as quantitative improvement in skin sclerosis or joint range of motion. Treatment success was defined as SCR at 6 months without crossover, recurrent malignancy or death. Secondary endpoints included changes of B-cell profiles in blood (BAFF levels and cellular subsets), patient-reported outcomes, and histopathology between responders and nonresponders with each therapy. RESULTS: SCR was observed in 9 of 35 [26%; 95% confidence interval (CI); 13%-43%] participants randomized to imatinib and 10 of 37 (27%; 95% CI, 14%-44%) randomized to rituximab. Six (17%; 95% CI, 7%-34%) patients in the imatinib arm and 5 (14%; 95% CI, 5%-29%) in the rituximab arm had treatment success. Higher percentages of activated B cells (CD27(+)) were seen at enrollment in rituximab-treated patients who had treatment success (P = 0.01), but not in imatinib-treated patients. CONCLUSIONS: These results support the need for more effective therapies for cutaneous sclerosis and suggest that activated B cells define a subgroup of patients with cutaneous sclerosis who are more likely to respond to rituximab.

Coal-fired Power Plants with Flexible Amine-based CCS and Co-located Wind Power: Environmental, Economic and Reliability Outcomes

Carbon Capture and Storage (CCS) technologies provide a means to significantly reduce carbon emissions from the existing fleet of fossil-fired plants, and hence can facilitate a gradual transition from conventional to more sustainable sources of electric power. This is especially relevant for coal plants that have a CO2 emission rate that is roughly two times higher than that of natural gas plants. Of the different kinds of CCS technology available, post-combustion amine based CCS is the best developed and hence more suitable for retrofitting an existing coal plant. The high costs from operating CCS could be reduced by enabling flexible operation through amine storage or allowing partial capture of CO2 during high electricity prices. This flexibility is also found to improve the power plant’s ramp capability, enabling it to offset the intermittency of renewable power sources. This thesis proposes a solution to problems associated with two promising technologies for decarbonizing the electric power system: the high costs of the energy penalty of CCS, and the intermittency and non-dispatchability of wind power. It explores the economic and technical feasibility of a hybrid system consisting of a coal plant retrofitted with a post-combustion-amine based CCS system equipped with the option to perform partial capture or amine storage, and a co-located wind farm. A techno-economic assessment of the performance of the hybrid system is carried out both from the perspective of the stakeholders (utility owners, investors, etc.) as well as that of the power system operator.

In order to perform the assessment from the perspective of the facility owners (e.g., electric power utilities, independent power producers), an optimal design and operating strategy of the hybrid system is determined for both the amine storage and partial capture configurations. A linear optimization model is developed to determine the optimal component sizes for the hybrid system and capture rates while meeting constraints on annual average emission targets of CO2, and variability of the combined power output. Results indicate that there are economic benefits of flexible operation relative to conventional CCS, and demonstrate that the hybrid system could operate as an energy storage system: providing an effective pathway for wind power integration as well as a mechanism to mute the variability of intermittent wind power.

In order to assess the performance of the hybrid system from the perspective of the system operator, a modified Unit Commitment/ Economic Dispatch model is built to consider and represent the techno-economic aspects of operation of the hybrid system within a power grid. The hybrid system is found to be effective in helping the power system meet an average CO2 emissions limit equivalent to the CO2 emission rate of a state-of-the-art natural gas plant, and to reduce power system operation costs and number of instances and magnitude of energy and reserve scarcity.

Practices and outcomes of self-treatment with helminths based on physicians' observations.

The successful use of helminths as therapeutic agents to resolve inflammatory disease was first recorded 40 years ago. Subsequent work in animal models and in humans has demonstrated that the organisms might effectively treat a wide range of inflammatory diseases, including allergies, autoimmune disorders and inflammation-associated neuropsychiatric disorders. However, available information regarding the therapeutic uses and effects of helminths in humans is limited. This study probes the practices and experiences of individuals 'self-treating' with helminths through the eyes of their physicians. Five physicians monitoring more than 700 self-treating patients were interviewed. The results strongly support previous indications that helminth therapy can effectively treat a wide range of allergies, autoimmune conditions and neuropsychiatric disorders, such as major depression and anxiety disorders. Approximately 57% of the self-treating patients observed by physicians in the study had autism. Physicians reported that the majority of patients with autism and inflammation-associated co-morbidities responded favourably to therapy with either of the two most popular organisms currently used by self-treaters, Hymenolepis diminuta and Trichuris suis. However, approximately 1% of paediatric patients experienced severe gastrointestinal pains with the use of H. diminuta, although the symptoms were resolved with an anti-helminthic drug. Further, exposure to helminths apparently did not affect the impaired comprehension of social situations that is the hallmark of autism. These observations point toward potential starting points for clinical trials, and provide further support for the importance of such trials and for concerted efforts aimed at probing the potential of helminths, and perhaps other biologicals, for therapeutic use.

Non-Pharmacological Approaches for Pain Management in Sickle Cell Disease: Development of a Mindfulness-Based Intervention

Background: Sickle Cell Disease (SCD) is a genetic hematological disorder that affects more than 7 million people globally (NHLBI, 2009). It is estimated that 50% of adults with SCD experience pain on most days, with 1/3 experiencing chronic pain daily (Smith et al., 2008). Persons with SCD also experience higher levels of pain catastrophizing (feelings of helplessness, pain rumination and magnification) than other chronic pain conditions, which is associated with increases in pain intensity, pain behavior, analgesic consumption, frequency and duration of hospital visits, and with reduced daily activities (Sullivan, Bishop, & Pivik, 1995; Keefe et al., 2000; Gil et al., 1992 & 1993). Therefore effective interventions are needed that can successfully be used manage pain and pain-related outcomes (e.g., pain catastrophizing) in persons with SCD. A review of the literature demonstrated limited information regarding the feasibility and efficacy of non-pharmacological approaches for pain in persons with SCD, finding an average effect size of .33 on pain reduction across measurable non-pharmacological studies. Second, a prospective study on persons with SCD that received care for a vaso-occlusive crisis (VOC; N = 95) found: (1) high levels of patient reported depression (29%) and anxiety (34%), and (2) that unemployment was significantly associated with increased frequency of acute care encounters and hospital admissions per person. Research suggests that one promising category of non-pharmacological interventions for managing both physical and affective components of pain are Mindfulness-based Interventions (MBIs; Thompson et al., 2010; Cox et al., 2013). The primary goal of this dissertation was thus to develop and test the feasibility, acceptability, and efficacy of a telephonic MBI for pain catastrophizing in persons with SCD and chronic pain.

Methods: First, a telephonic MBI was developed through an informal process that involved iterative feedback from patients, clinical experts in SCD and pain management, social workers, psychologists, and mindfulness clinicians. Through this process, relevant topics and skills were selected to adapt in each MBI session. Second, a pilot randomized controlled trial was conducted to test the feasibility, acceptability, and efficacy of the telephonic MBI for pain catastrophizing in persons with SCD and chronic pain. Acceptability and feasibility were determined by assessment of recruitment, attrition, dropout, and refusal rates (including refusal reasons), along with semi-structured interviews with nine randomly selected patients at the end of study. Participants completed assessments at baseline, Week 1, 3, and 6 to assess efficacy of the intervention on decreasing pain catastrophizing and other pain-related outcomes.

Results: A telephonic MBI is feasible and acceptable for persons with SCD and chronic pain. Seventy-eight patients with SCD and chronic pain were approached, and 76% (N = 60) were enrolled and randomized. The MBI attendance rate, approximately 57% of participants completing at least four mindfulness sessions, was deemed acceptable, and participants that received the telephonic MBI described it as acceptable, easy to access, and consume in post-intervention interviews. The amount of missing data was undesirable (MBI condition, 40%; control condition, 25%), but fell within the range of expected missing outcome data for a RCT with multiple follow-up assessments. Efficacy of the MBI on pain catastrophizing could not be determined due to small sample size and degree of missing data, but trajectory analyses conducted for the MBI condition only trended in the right direction and pain catastrophizing approached statistically significance.

Conclusion: Overall results showed that at telephonic group-based MBI is acceptable and feasible for persons with SCD and chronic pain. Though the study was not able to determine treatment efficacy nor powered to detect a statistically significant difference between conditions, participants (1) described the intervention as acceptable, and (2) the observed effect sizes for the MBI condition demonstrated large effects of the MBI on pain catastrophizing, mental health, and physical health. Replication of this MBI study with a larger sample size, active control group, and additional assessments at the end of each week (e.g., Week 1 through Week 6) is needed to determine treatment efficacy. Many lessons were learned that will guide the development of future studies including which MBI strategies were most helpful, methods to encourage continued participation, and how to improve data capture.