Health Care Productivity

Alan M. Garber and
Alan M. Garber Department of Veterans Affairs and Stanford University
Martin Neil Baily David M. Cutler and
(Cambridge, MA.--Monday, July 28, 2003)   David M. Cutler is Professor of Economics, Associate Dean of the Faculty of Arts and Sciences and John L. Loeb Professor of Social Sciences.  Staff Photo by Rose Lincoln/Harvard University News Office
David M. Cutler Otto Eckstein Professor of Applied Economics - Harvard University
Ernst R. Berndt
Ernst Berndt
Ernst R. Berndt Professor in Applied Economics Emeritus - MIT Sloan School of Management

Microeconomics 1997

IN ALL OF THE INDUSTRIAL COUNTRIES, a high fraction of gross domestic
product (GDP), ranging from approximately 7 percent in the United
Kingdom to 14 percent in the United States, is devoted to health care.
In recent years policymakers have been forced to try to trim health care
benefits or other social services, and the health care systems of almost
all the industrial countries have come under significant pressure to
control expenditures and improve performance.
Although each nation’s health care system operates with a mixture
of regulation and market mechanisms, there are great differences among
them. And these differences suggest that policymakers could learn important
lessons by comparing performances across countries. Thus far,
however, no single system is recognized as being the most productive
or as having achieved the right blend of competition and regulation. No
system provides the paradigm for others.