Question

Based on your success with minimum wage analysis in Assignment #5, the new administration now has a new study for you to conduct. With health care, they are considering two alternatives: A system where health care is provided solely by the government (similar to what is in Canada) and another approach where government stays out of the health care market (except for assisting the poor who cannot afford it) and individuals buy health insurance from competing providers. Provide an economic analysis of the advantages and disadvantages of both alternatives and conclude by making a recommendation for one of them.