Health Economics


The course undertakes a microeconomic analysis of health systems. It looks at both empirical work (study of individual data on healthcare supply and demand behaviour) and theoretical work (applications of regulation models in the health sector). It examines recent reforms undertaken in France and abroad and seeks to determine whether their effects comply with the predictions of theoretical models of regulation applied to the health sector.



  1. Insurance, actuarial management and the management of long-term risks– Health insurance and competition: market mechanism and actuarial neutrality; actuarial pricing and the management of long-term risks (reclassification risk, ex ante/ex post effectiveness).
  2. Health insurance, anti-selection and risk selection– The reactions of insurers according to the regulation method (theoretical approaches and empirical results); risk selection (selection practices, consequences in terms of effectiveness, regulation).
  3. Health insurance and moral hazard– Ex ante moral hazard; ex post moral hazard (theoretical aspects and empirical results).
  4. Health insurance and vertical integration– Presentation of different forms of vertical integration; theoretical analyses.
  5. The different modes of regulation of healthcare producers– Remuneration schemes: prospective and retrospective payment; induced demand (theoretical aspects and empirical results); organisation of primary care, quality of care and care for chronic pathologies.
  6. Regulation of hospital spending– Pricing by pathology: presentation of the French system ("pricing by activity"); theoretical analysis of pricing by pathology (equity between institutions, patient selection and medical decision-making).
  7. Regulation of pharmaceutical spending– Medication regulation in France; innovation, generic medicines.



Arrow Kenneth J., “Uncertainty and the welfare economics of medical care”, American Economic Review, vol. LIII, n.5, dec. 1963 (cf. Jstor)
Culyer A.J. et J.P. Newhouse, Handbook of Health Economics, North-Holland,  [53 CUL 00 A [Usuel]] Newhouse Joseph P., Free For All ? : Lessons from the Rand Health Insurance Experiment, Harvard University Press, (1996) [73 NEW 00 A] Phelps Charles E., Health Economics, Harper et Collins, New-York, (1992) [63 PHE 01 A]