Question 1: Market Structure and Concentration

Given the following information:

# of US
Businesse
NAICS # Health Care and Social Assistance Sector s
62131
0 4 Offices of Chiropractors          37,103
62121
0 3 Offices of Dentists        107,552
62133 Offices of Mental Health Practitioners (except
0 6 Physicians)          22,988
62132
0 5 Offices of Optometrists          16,924
62134 Offices of Physical, Occupational and Speech
0 7 Therapists, and Audiologists          15,583
62111 Offices of Physicians (except Mental Health
1 1 Specialists)       209,966
62111
2 2 Offices of Physicians, Mental Health Specialists  10,284
62139
1 8 Offices of Podiatrists            8,446
62139 Offices of All Other Miscellaneous Health
9 9 Practitioners           21,614

Use all available information to discuss the above sectors, including

concentration, market structure, and sensitivity to price changes.
For this industry, the Health Care and Social Assistance Sector, there
are 824,110 businesses in the United States. Also, provide citations
on sources for maximum point value.
Health Care & Social Assistance Sector

The Health Care and Social Assistance sector encompasses

businesses providing health care and social support for
individuals. The sector incorporates both health care and social
assistance because it is sometimes difficult to differentiate
connecting the precincts of these two activities. The industries
engross in this sector are prearranged on a series, starting
with those who provide totally medical care, ongoing with those
providing health care and social assistance, and finally ending
with those who provide social assistance only.

The services provided by these institutions are delivered by

trained professionals who are specialized in their particular
field. All industries in the sector share this commonality of
process, namely, labor inputs of health practitioners or social
workers with the requisite expertise. Many of the industries in
the sector are defined based on the educational degree held by
the practitioners included in the industry.

Market Concentration, market structure & price

sensitivity:

Market concentration is a function of the number of sectors

and their respective shares of the total production in a market.
However in the sector of Health Care Social Assistance there are
824,110 businesses in the United States out of which there are 9
offices.

In this sector the first office is of Physicians (except

Mental Health Specialists), primarily affianced in the
independent practice of general or specialized medicine or
surgery except the psychiatry or psychoanalysis. These physicians
operate privately or mostly have their own clinics and centers.
It ranks the first in the health care industry. The number of US
business involve in this are approximately 209,966. Therefore it
means that the physicians are most concentrated in this sector,
as they occupied almost 47% of share in the industry which is the
largest in the US market, mainly because they deal with daily day
to day problems such as flu, temperature etc.

Health Care and Social Assistance Sector

Offices of Chiropractors
Offices of Dentists
Offices of Mental Health Practioners
Offices of Optometrits
Offices of Physical, Occupational & Speech Therapists, & Audiologists         
Offices of Physicians
Offices of Physicians Mental Health
Offices of Podiatrists
All other Miscellaneous Health Practitioners

2% 2% 5% 8%

24%
47%
5%
3% 4%

However as an economic tool market concentration is useful

because it reflects the degree of competition in the market. This
signifies that offices of physicians consist of a very large
number of firms producing a homogeneous product and thus have
largest number of competitors. They have a really strong market
structure in the United States market. Similarly the price will
be sensitive because there are a lot of businesses and they are
interdependent. As the business with higher market concentration
have a greater number of influences over price.
 In the same way offices of dentists have the second
position. They have 23% of the market share and occupy 107,552
numbers of businesses. This means again a large number of
competitions but less than the physicians, as this industry is
primarily engaged in one specialized field of dentistry or dental
surgery. But still the price in this field will be sensitive due
to the involvement of lot of businesses.

The offices of chiropractors rank the third in the Health

Care industry. 37,103 businesses are involved in this ground. A
huge difference from the previous offices but still they occupy
8% of the market.

The offices of Mental Health Practitioners and all other

Miscellaneous Health Practitioners have the 5% of market share.
They run 22,988 and 21,614 businesses. Mental Health
Practitioners have 1374 more number of firms as compare to all
other Miscellaneous Health Practitioners. This means the Mental
Health Practitioners are more concentrated in the market, thus
they more sensitive towards the price and are facing a little
higher competition then the all other Miscellaneous Health
Practitioners.

The Offices of Physical, Occupational

and Speech Therapists, and Audiologists have 15,583 businesses in
the U.S economy. These offices are mostly affianced in physical
therapy treatment such as bone injuries or individual
disabilities, which are rare cases in the United States.

Lastly the offices of Podiatrists are the least concentrated

in the center. They run 8,446 businesses, however there is not
much difference between the offices of Physicians, Mental Health
Specialists, they have 10,284 number of business. But if we
compare them with the businesses they run Podiatrists have the
minimum market share. Basically Podiatrists are basically
involved in the independent practice of podiatry. These
practitioners diagnose and treat diseases and deformities of the
foot and operate private or group practices in their own offices,
which are the uncommon cases in the U.S. This shows that they are
facing the least number of competitions in the market with low
prices which uniformly result in short market structure