Economic Theory in Healthcare

Economic theory in healthcare examines how resources, including money, time, and labor, are allocated to provide medical services and treatments. It analyzes the costs and benefits of healthcare decisions, aiming to maximize patient outcomes while minimizing expenses. Key concepts include supply and demand for medical services, the impact of insurance on healthcare access, and the role of incentives for both providers and patients. Understanding these dynamics helps policymakers design better healthcare systems, ensuring that resources are used effectively to improve public health and manage healthcare costs.