Health Economics (Healthcare Economics and Innovation)

Health Economics is a branch of applied microeconomics that uses economic principles to analyze the production, consumption, and distribution of health and healthcare services. It examines the behavior of individuals, providers, insurers, and governments in making decisions about scarce health resources, focusing on issues like the demand for medical care, the functioning of insurance markets, and the efficiency and equity of various healthcare systems. A critical component of the field is the study of innovation, which evaluates the economic incentives for developing new drugs and medical technologies, assesses their value and cost-effectiveness, and analyzes their impact on health outcomes and overall spending.

1. Foundations of Health Economics
   1. Introduction to Health Economics
      1. Defining Health Economics
      2. Historical Development of Health Economics
      3. Scope and Applications of Health Economics
      4. Relationship to Other Economic Fields
      5. Key Questions in Health Economics
   2. Scarcity and Choice in Healthcare
      1. Concept of Scarcity in Health Resources
      2. Opportunity Cost in Healthcare Decisions
      3. Resource Allocation Mechanisms
      4. Trade-offs in Health Policy
   3. The Production of Health
      1. Health Production Functions
      2. Inputs to Health Production
         1. Medical Care Inputs
         2. Lifestyle Inputs
         3. Environmental Inputs
         4. Genetic Factors
      3. Diminishing Returns in Health Production
      4. Efficiency in Health Production
   4. Unique Characteristics of Healthcare Markets
      1. Uncertainty in Health and Treatment Outcomes
         1. Diagnostic Uncertainty
         2. Prognostic Uncertainty
         3. Treatment Effectiveness Uncertainty
         4. Impact on Consumer Behavior
      2. Information Asymmetries
         1. Provider-Patient Information Gaps
         2. Insurer-Patient Information Gaps
         3. Principal-Agent Problems
            1. Physician as Agent
            2. Insurance Company as Agent
            3. Conflicts of Interest
      3. Externalities in Healthcare
         1. Positive Externalities
            1. Vaccination Benefits
            2. Herd Immunity Effects
            3. Research Spillovers
         2. Negative Externalities
            1. Antibiotic Resistance
            2. Communicable Disease Transmission
            3. Environmental Health Impacts
      4. Public Good Characteristics
         1. Non-rivalry in Consumption
         2. Non-excludability
         3. Examples in Healthcare
   5. Equity and Need in Healthcare
      1. Concepts of Equity
         1. Horizontal Equity
         2. Vertical Equity
         3. Procedural vs. Outcome Equity
      2. Measuring Health Inequality
         1. Concentration Curves
         2. Gini Coefficients
         3. Health Inequality Indices
      3. Need vs. Demand vs. Utilization
      4. Distributive Justice in Healthcare
   6. Core Microeconomic Principles Applied to Health
      1. Consumer Theory in Health
         1. Utility Maximization
         2. Health Utility Functions
         3. Marginal Utility of Health
         4. Budget Constraints
      2. Supply and Demand Analysis
         1. Demand for Health vs. Healthcare
         2. Supply of Healthcare Services
         3. Market Equilibrium
         4. Consumer and Producer Surplus
      3. Elasticity Concepts
         1. Price Elasticity of Demand
         2. Income Elasticity of Demand
         3. Cross-Price Elasticity
         4. Empirical Estimates
      4. Market Efficiency
         1. Pareto Efficiency
         2. Allocative Efficiency
         3. Technical Efficiency
         4. Dynamic Efficiency