The High Price of Doctors: A Disease of Regulation
4th March 2013
Bryan Caplan explains some inconvenient truth.
In any normal labor market, massive female entry would have led to a large increase in total workers. But the market for new doctors is anything but normal. The rise in new female doctors has been almost perfectly offset by a matching fall in new male doctors.
My point, of course, is not that women have “stolen” men’s places in medical school. My point, rather, is that that draconian government entry barriers are the only credible explanation of the facts. Why else would the number of male doctors have fallen so far relative to demand? Infinitely inelastic demand for medical services? A massive decline in the talent of male applicants to medical school?!
As our population ages, we have naturally seen a large increase in the demand for doctors. If the market for M.D.s worked normally, however, we would have fortuitously experienced a large offsetting supply shock: the rise of the female doctor. Regulation has deprived us of this godsend – and deprived vast numbers of qualified men and women of the right to work in their preferred occupation. Thanks to government entry barriers, demand has gone up and supply is frozen in place. Consumers and taxpayers are paying a fortune for medical care. And the problem is only going to get worse.