Health and Economics

Krugman and Wells' Analysis of the Health Care Crisis

From obesity to ADD, health care issues often seem to be of serious concern to Americans. However, it seems like barely a day goes by without the media reporting on the declining quality and increasing cost of health care in the US. This crisis has been developing for some time; between 1960 and 2006 the US saw a 33-fold increase in the amount of money spent per capita on health care

According to the CDC's National Center for Health Statistics, in 2006 approximately 43.3 million people, or 16.8 percent of the US population under age 65 was uninsured.

Krugman and Wells

Paul Krugman and his wife Robin Wells are both professors at Princeton University, where they have collaborated on a number of scholarly articles, such as the one we will discuss here, as well as our lovely textbook. Additionally, Krugman's research focuses on international trade and currency crises; he is one of the founders of the "new trade theory." Wells' research is devoted to theories of organizations and incentives.

The "consumer-directed" diversion

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