- Assume that health production is subject to diminishing returns and that each unit of healthcare employed entails a constant rate of iatrogenic (medically caused) disease. Would the product of health function eventually bend downward? Explain.
- What role did public health play in the historical decline in mortality rates?
- Suppose you were hired as an adviser to a developing country and you were versed in the theory of production, the historical role of medicine, and the modern-day health production functions studies. Their government seeks advice on the wisdom of a relative emphasis on health and health investment versus other forms of economic investment. What would be your advice?
- Contrast technical and allocative efficiency. How can technical and allocative inefficiency in healthcare firms affect patient welfare?
- Which of the following types of technological change in healthcare are likely to be cost increasing: (A) threats of malpractice suits cause physicians to order more diagnostic tests on average for a given set of patient symptoms; (B) a new computer-assisted scanning device that enables physician to take much more detailed pictures on the brain: (C) the introduction of penicillin earlier in this century; (D) greater emphasis on preventive care? Discuss.
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