Discuss whether the government or the private sector should provide health care in the UK

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James Weir                29/01/2012

Discuss whether the government or the private sector should provide health care in the UK

Health care in the UK is classed as a merit good because it provides more private benefits for consumers than they actually realise. Merit goods such as health care also have beneficial positive externalities for the economy in terms of increase output and for the UK population as a whole. The health care system will reduce the amount of ill people in the population, which creates a positive externality because people will be happier.

There are many economic and social benefits of the health care service including an improved quality of life. There is now soπlid evidence that improvements in medical care will pay off in the long run in terms of healthier people and longer lives. Plus the life expectancy is set to rise in the UK if further improvements in health care are continued. An economic benefit of the health care system is that the NHS is the largest employer in the UK with over 1.3 million people employed in England alone. Health is said to be the biggest aspect of government expenditure, which is also beneficial to the economy as a whole.

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The government has to choose a specific part of the economy to invest in, so by investing in health care, the government has to decrease investment somewhere else. The opportunity cost of the government spending money on the health care service is spending the money on another service such as farmland abroad for farmers.  There are many costs of running the National Health Service in the UK, some labour costs and some administrative costs. The main costs are the labour costs together with the money spent on drugs and specialist equipment. Every year the government spends many billions of ...

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This essay makes a poor case for government provision and none at all for private sector provision. The writer does not understand how the NHS operates (the government does not subsidise the NHS) or a private health care system could operate.