Question

Evaluate the following policies according to the two differing theories:

1. Medicare and Medicaid beneficiaries, taxation, and the generosity of benefits

2. The performance of state licensing boards in monitoring physician qualityality

Answer 1

ECONOMIC THEORY:
a) -Medicare has higher more generous benefits that medicaid because they elderly have more political power and can provide more benefit to legislators
-Taxation is regressive and is spread to and diffuse
-generosity of benefits is based on the amount of political support a group may offer
b) state licensing boards are barriers to entry and prevent competition in a regulated field which drives up costs.

PUBLIC INTEREST THEORY:
a) - Medicare and Medicaid is the right thing to do.
-Taxation should be progressive.
-better benefits for the poor .
b) monitoring is done to keep population safe