Go to The Economics of Health Care
Page 12
2. The free market approach
Sections

i. What is a market?
a. Demand - analysing the buyers
b. Supply - analysing the sellers
c. The market
d. How a market allocates resources
e. Case study - cosmetic surgery
f. Elasticity
g. Markets as dynamic systems
ii. Health care - case for a free market
Case study - health care in the US
iii. Questions and activity

 

 

 

 

 

 

 

 

 

 

 

One way in which the problem of scarcity can be overcome is to let people buy the health care they want. This is what happens with most cosmetic surgery. "A man can have a facelift, a nose correction and his eyes tightened up. His whole face can be rebuilt for a third of the cost of the front end of an expensive car respray" - The Guardian 7.6.91



All these treatments and more are available if you want to buy them and have the money to pay for them. This kind of health care is sold just like any consumer good. People buy the treatment because they gain satisfaction from it, in just the same way that they would gain satisfaction from a car or a new dress. As consultant plastic surgeon David Sharpe puts it "There's nothing wrong with having plastic surgery, even if you don't need it. It's like buying a Porsche. You don't need one. It just makes you feel better".

The market for cosmetic surgery shows that it is possible to buy and sell health care. To understand how such a market might work as a resource allocation system, we need to look at the different elements involved in any market. Look at 'What is a market' to see what these elements are. Even if a market can work for cosmetic surgery what about the rest of health care? Look at 'Health care - case for a free market' for some views on this.

Now look at these (check the status bar for information)

i. What is a market?
ii. Health care - case for a free market
Further questions