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Статья

The Manifestation of Market Failure in Healthcare

European Journal of Social Sciences. 2013. Vol. 40. No. 1. P. 115-122.

Healthcare, like any area of human activity involving the use of limited resources of society, faces two primary objectives: achieving efficiency and fairness in the provision of medical services. As is well known, in most cases the competitive market ensures the optimal allocation of resources.

However, healthcare has some distinctive features which give rise to market failure in this area, resulting in state intervention in the economic relations between the providers (hospitals and doctors) and consumers of medical services, and leads to the emergence of the institution of insurance. The economic aspects of healthcare predetermine a special mechanism for the functioning of this market, and allow us to talk of special types of competition in this sector. The aim of this article is to describe and analyse manifestations of market failure in healthcare in order to subsequently develop measures to reduce costs and increase the profitability of this area.