Earlier this month, 120 econometric students from 30 universities around the world gathered in Amsterdam to play a game. They were competing for the Econometrics World Championship which was held for the 17th time. (Yes, I had to look it up, too. According to Investopedia.com, econometrics is “the application of statistical and mathematical theories to economics for the purpose of testing hypotheses and forecasting future trends.”)
The case study put before the contestants dealt with effects of the economic crisis in Europe, using a data set that was provided to the teams. The ultimate winner was Harvard. Their team came up with an analysis of the impact of an economic crisis on the health of a country’s citizens, and the impact a government can have on the situation. They showed that for the poor who are dealing with illness, their healthcare costs remain constant even while their income declines in a recession. The healthy poor, however, are also negatively affected. In order to save money, they are less likely to see medical attention in the event of illness, and spend less on prevention to remain healthy. As a result, the healthcare costs for this group can rise more than for those with greater income. Government intervention can maximize their healthcare investment by spending more on prevention for the poor during economic hard times.
As Big Data plays an ever-growing role in the planning and delivery of healthcare services, exercises such as this competition will help hone the skills of the students who are likely to help us get the most out of this information.
