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If the issue is information asymmetry, you could say the same thing about car repairs. Most people don't know a thing about fixing their car, and if it's not fi

If the issue is information asymmetry, you could say the same thing about car repairs. Most people don't know a thing about fixing their car, and if it's not fixed correctly, they could die. I don't see this pricing issue happening with car repairs though. I think that with sufficient competition and a system that doesn't require/encourage people to go to the specialists recommended by their primary care physicians, you could significantly drive prices down. There is in fact probably a place for technology in all this, insofar as curating and maintaining accurate statistics on the record of individual doctors in a manner that is easily accessible to all patients. Then you wouldn't have primary care physicians giving referrals to friends from medical school or residency (a change that could actually improve specialist quality).

001sky 14y ago
http://en.wikipedia.org/wiki/Hold-up_problem http://en.wikipedia.org/wiki/Hold-up_problem The stakes are much higher in medicine/law/and finance. But similar "hold-up" dynamics are pretty frequent as low levels in car repairs (classically, taking advantage of women). A more intermediary example is is Home Building (the so-called change-orders, also at play in public works). Its really a combination of information assymetry, high-stakes, and some form of sunk cost or switching/searching costs that are prohibitive. You can't change your builder with a hole in the ground, you can't change your car-repair guy with your car-motor in pieces, etc. Alas, I don't want to beat the explanation to death. Its not meant to be the sole explanatory variable. I just thought it was useful to be aware of. In the case of healthcare, in particular, I don't dis=agree with the structural market issues (lack of direct pricing, non-transparency, etc.). But if you look at drug pricing, see what they charge for cancer drugs. And look at places like the NHS in britain who won't pay $100k for a course of drugs out of principle. There is more to the story for those interested in the subject is all.

001sky 14y ago

http://en.wikipedia.org/wiki/Hold-up_problem http://en.wikipedia.org/wiki/Hold-up_problem The stakes are much higher in medicine/law/and finance. But similar "hold-up" dynamics are pretty frequent as low levels in car repairs (classically, taking advantage of women). A more intermediary example is is Home Building (the so-called change-orders, also at play in public works). Its really a combination of information assymetry, high-stakes, and some form of sunk cost or switching/searching costs that are prohibitive. You can't change your builder with a hole in the ground, you can't change your car-repair guy with your car-motor in pieces, etc. Alas, I don't want to beat the explanation to death. Its not meant to be the sole explanatory variable. I just thought it was useful to be aware of. In the case of healthcare, in particular, I don't dis=agree with the structural market issues (lack of direct pricing, non-transparency, etc.). But if you look at drug pricing, see what they charge for cancer drugs. And look at places like the NHS in britain who won't pay $100k for a course of drugs out of principle. There is more to the story for those interested in the subject is all.