Introduction to Health Economics 2Nd Edition
Total Page：16
File Type：pdf, Size：1020Kb
Introduction to Health Economics Understanding Public Health Second Edition Introduction to Introduction “This book would be an excellent choice for anyone wishing to be introduced to the field of health economics – it is undoubtedly the best ‘Health Economics 101’ textbook around.” Professor Di McIntyre, South African Research Chair of Health and Wealth, Health Introduction to Economics Unit, University of Cape Town, South Africa “There are several books on the market now that claim to take readers into the intricacies of health economics ‘from first Health Economics principles’. To me, this book succeeds better than any.” Health Economics Gavin Mooney, Honorary Professor, University of Sydney and University of Cape Town; Visiting Professor, Aarhus University, the University of New South Wales and Second Edition the University of Southern Denmark Written in a user-friendly manner, this practical book covers key economic principles, such as supply and demand, healthcare markets, healthcare finance and economic evaluation. The book has been thoroughly updated with new material reflecting important recent developments and policy shifts such as the rise of performance based funding in health care, the impact and cost of achieving universal health care and the growing effect of globalization and international trade on the health sector. This engaging new edition features: Ⅲ Extensive use of global examples from low, middle and high income countries, real case studies and exercises to facilitate the Second understanding of economic concepts Edition Ⅲ A greater emphasis on the practical application of economic theories and concepts to the formulation of health policy by Edited Ⅲ New chapters on macroeconomics, globalization and health and provider payments Ⅲ Extensively revised chapters on demand and supply, markets and economic evaluation & Wiseman Guinness Introduction to Health Economics 2nd edition is the ideal companion text for students, public health practitioners, policy makers, managers and researchers looking for a greater understanding of health economics principles. Lorna Guinness is a lecturer at the London School of Hygiene and Tropical Medicine, UK and Visiting Research Fellow at the Australian National University, Australia. Virginia Wiseman is a senior lecturer at the London School of Hygiene and Tropical Medicine, UK. Cover design Hybert Design • www.hybertdesign.com Edited by www.openup.co.uk Lorna Guinness & Virginia Wiseman Introduction to Health Economics Second edition 23312.indb i 22/08/2011 11:30 Understanding Public Health Series Series editors: Ros Plowman and Nicki Thorogood, London School of Hygiene & Tropical Medicine. Throughout the world, there is growing recognition of the importance of public health to sustainable, safe and healthy societies. The achievements of public health in nineteenth-century Europe were for much of the twentieth century overshadowed by advances in personal care, in particular in hospital care. Now, in the twenty- fi rst century, there is increasing understanding of the inevitable limits of individual health care and of the need to complement such services with effective public health strategies. Major improvements in people’s health will come from controlling communicable diseases, eradicating environmental hazards, improving people’s diets and enhancing the availability and quality of effective health care. To achieve this, every country needs a cadre of knowledgeable public health practitioners with social, political and organizational skills to lead and bring about changes at international, national and local levels. This is one of a series of books that provides a foundation for those wishing to join in and contribute to the regeneration of public health, helping to put the concerns and perspectives of public health at the heart of policy- making and service provision. While each book stands alone, together they provide a comprehensive account of the three main aims of public health: protecting the public from environmental hazards, improving the health of the public and ensuring high quality health services are available to all. Some of the books focus on methods, oth- ers on key topics. They have been written by staff at the London School of Hygiene & Tropical Medicine with considerable experience of teaching public health to students from low, middle and high income countries. Much of the material has been developed and tested with postgraduate students both in face-to-face teaching and through distance learning. The books are designed for self-directed learning. Each chapter has explicit learning objectives, key terms are highlighted and the text contains many activities to enable the reader to test their own understanding of the ideas and material covered. Written in a clear and accessible style, the series is essential reading for students taking postgraduate courses in public health and will also be of interest to public health practitioners and policy-makers. Titles in the series Analytical models for decision making: Colin Sanderson and Reinhold Gruen Controlling communicable disease: Norman Noah Economic analysis for management and policy: Stephen Jan, Lilani Kumaranayake, Jenny Roberts, Kara Hanson and Kate Archibald Economic evaluation: Julia Fox-Rushby and John Cairns (eds) Environmental epidemiology: Paul Wilkinson (ed) Environmental health policy: Megan Landon and Tony Fletcher Financial management in health services: Reinhold Gruen and Anne Howarth Global change and health: Kelley Lee and Jeff Collin (eds) Health care evaluation: Sarah Smith, Don Sinclair, Rosalind Raine and Barnaby Reeves Health promotion practice: Maggie Davies, Wendy Macdowall and Chris Bonell (eds) Health promotion theory: Maggie Davies and Wendy Macdowall (eds) Introduction to epidemiology, second edition: Ilona Carneiro and Natasha Howard Introduction to health economics, second edition: Lorna Guinness and Virginia Wiseman (eds) Issues in public health, second edition: Fiona Sim and Martin McKee (eds) Managing health services: Nick Goodwin, Reinhold Gruen and Valerie Iles Medical anthropology: Robert Pool and Wenzel Geissler Principles of social research: Judith Green and John Browne (eds) Public health in history: Virginia Berridge, Martin Gorsky and Alex Mold Understanding health services: Nick Black and Reinhold Gruen Forthcoming titles: Sexual health: a public health perspective: Kaye Wellings, Martine Collumbien, Wendy Macdowall and Kirstin Mitchell Confl ict and health: Natasha Howard, Egbert Sondorp and Annemarie ter Veen (eds) Making health policy, second edition: Kent Buse, Nicholas Mays and Gill Walt Environment, health and sustainable development, second edition: Emma Hutchinson and Megan Landon (eds) 23312.indb ii 22/08/2011 11:30 Dedications For John, Thomas and Theo LG I would like to dedicate this book to my parents, Kaye and Don, for their enduring support. I also dedicate it to my children, Franklin, Myrtle and Rose who have always reminded me of the importance of play as well as work. Finally, to my husband, Steve, who has the patience of a saint. VW 23312.indb iii 22/08/2011 11:30 23312.indb iv 22/08/2011 11:30 Introduction to Health Economics Second edition Edited by Lorna Guinness and Virginia Wiseman 23312.indb v 22/08/2011 11:30 Open University Press McGraw-Hill Education McGraw-Hill House Shoppenhangers Road Maidenhead Berkshire England SL6 2QL email: [email protected] world wide web: www.openup.co.uk and Two Penn Plaza, New York, NY 10121-2289, USA First published 2005 Reprinted 2006, 2007, 2008, 2009, 2010 Second edition 2011 Copyright © London School of Hygiene & Tropical Medicine 2011 All rights reserved. Except for the quotation of short passages for the purpose of criticism and review, no part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of the publisher or a licence from the Copyright Licensing Agency Limited. Details of such licences (for reprographic reproduc- tion) may be obtained from the Copyright Licensing Agency Ltd of Saffron House, 6–10 Kirby Street, London EC1N 8TS. A catalogue record of this book is available from the British Library ISBN-13: 978-0-33-524356-3 ISBN-10: 0-33-524356-8 eISBN: 978-0-33-524357-0 Library of Congress Cataloging-in-Publication Data CIP data applied for Typeset by Refi neCatch Limited, Bungay, Suffolk Printed in the UK by Bell & Bain Ltd, Glasgow Fictitious names of companies, products, people, characters and/or data that may be used herein (in case studies or in examples) are not intended to represent any real individual, company, product or event. 23312.indb vi 22/08/2011 11:30 Contents The editors ix Acknowledgements x Introduction 1 Section 1: Economics and health economics 5 1 Key concepts in health economics 7 Virginia Wiseman 2 Macroeconomics, globalization and health 21 Richard Smith Section 2: Demand and supply 35 3 A simple model of demand 37 Virginia Wiseman and Stephen Jan 4 Measuring demand 55 Virginia Wiseman 5 Supply: production in the long and short run 69 Lorna Guinness (ed.) 6 Supply: costs, economies of scale and the supply curve 83 Lorna Guinness Section 3: Markets 99 7 A simple market model 101 Virginia Wiseman and Lorna Guinness 8 Health care markets and effi ciency 117 Lorna Guinness and Virginia Wiseman Section 4: Health care fi nancing 133 9 The changing world of health care fi nance 135 Lorna Guinness and Reinhold Gruen