Lecture: Role of Government Chapter 19 Outline

Role of Public and Private Sector

• Argue that information imperfections, flawed agency relationships, and other distortions cannot be readily corrected by private markets.
• The point to the US record with the highest cost of health care, least regulation, and poor health outcomes compared to other developed countries as proof.

Role of Public and Private Sector

• Competition: An increased emphasis on market mechanisms and market forces with a decreased in use of regulatory instruments.
• Is seen in two ways:
• Adhere more of a competitive market.
• Rely on financial incentives instead of controls to achieve goals.