Introducing Health Economics

Economics, Health and Health Economics Key Economic Concepts Exercise Seminar Allocation
HEA PTP: M207 Health Economics 1

Economics, Health and Health Economics

1. What is Economics?
2. What is Health? 3. What is Health Economics?

HEA PTP: M207 Health Economics 2

What is Economics?
Economics is
concerned with money?

the same as accountancy?

only practised by economists?

objective?
HEA PTP: M207 Health Economics 3

Economics in a nutshell
Resources are scarce
What we want is unlimited Therefore involves choice Max. bens/min. resources = efficiency
HEA PTP: M207 Health Economics 4

Pessimist: Optimist: Economist:

bottle empty bottle full bottle wasted

inefficient!
HEA PTP: M207 Health Economics 5

Economics and Money

ECONOMICS = costs (resource use)
benefits choice efficiency MONEY = store of value

means of exchange
HEA PTP: M207 Health Economics 6

Economics Accountancy
ECONOMICS = costs (resource use)
benefits choice efficiency ACCOUNTANCY = monitor of financial transactions
HEA PTP: M207 Health Economics 7

Only Economists Practice Economics?

ECONOMICS = costs (resource use) benefits CHOICE efficiency

Weigh-up relative benefits of each course of action and choose the action which maximises well-being.
HEA PTP: M207 Health Economics 8

Economics Objective
All decisions are based on subjective value judgements.
Economics makes these explicit.

HEA PTP: M207 Health Economics 9

Topic Versus Discipline

TOPIC = area of study
conceptual apparatus

DISCIPLINE =

Health economics is the discipline of economics applied to the topic of health.

HEA PTP: M207 Health Economics 10

What is Health?
World Health Organisation:
Health is a state of complete physical, mental and social well-being Health Economics is often Health Care Economics.
HEA PTP: M207 Health Economics 11

Task of Economics
Descriptive
Predictive Evaluative

=
= =

quantification
identify impact of change relative preference over situations

HEA PTP: M207 Health Economics 12