Based on your success with minimum wage analysis in Assignment #5, the new administration now has a...

Question

Based on your success with minimum wage analysis in Assignment #5, the new administration now has a new study for you to conduct. With health care they are considering two alternatives: A system where health care is provided solely by the government (similar to what is in Canada) and another approach where government stays out of the health care market (except for assisting the poor who cannot afford it) and individuals buy health insurance from competing providers. Provide an economic analysis of the advantages and disadvantages of both alternatives and conclude by making a recommendation for one of them. Your work should be 3-4 pages long, in APA format, and make use of at least two recent, scholarly articles.

Robert · Accepted Answer

The question of who should provide the health care service to people is very difficult to answer. 
Whether health care services should be provided fully by the government or by the private 
service provider is contentious issue. There are people who argue that health a care service is 
crucial service and therefore same should be provided by the government of a country. They 
argue that health care service has positive externality and this positive externality is the basis for 
the argument of those who argue for full government role in providing health care services. A 
positive externality is the benefit received by a third party as a result of an action by another 
person and the personal who received the benefit is not directly or indirectly is involved in the 
transaction. People argue that in the presence of positive externality private service providers 
will not produce the health care service in sufficient quantities that is desired by the society or in 
socially optimum quantity. This is basis for argument for full government role in providing 
health care service to public. There are people who fully oppose government role in providing 
health care services. Instead they argue that government has no role in health care services or 
government role should be restricted to only regulating the private service providers. Economic 
efficiency will be improved if health care service is left private service providers.

Based on your success with minimum wage analysis in Assignment #5, the new administration now has a new study for you to conduct. With health care they are considering two alternatives: A system where...

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