Case 4.2 Licensing and Laissez Faire Essay
Case 4.2 Licensing and Laissez Faire Milton Friedman, a Nobel Prize winning economist believes that the licensing in all fields interferes with Laissez Faire, the principle of the free market. The case titled “Licensing and Laissez Faire” focuses on the issues of licensing within the American Medical Association (AMA). The AMA was formed to raise physicians’ incomes by paying hospitals to limit the number of physicians they train. It is well known that their strategy worked, American physicians make far more than physicians in other countries. Friedman argues that limiting the numbers of students in the admission policy violates a moral rule and is restricting freedom of opportunity; however, letting incompetent physicians …show more content…
According to Association of American Medical Colleges, President and CEO Darrell Kirch predicts a significant shortage of doctors is expected in the United States in 2025. It’s particularly serious for the kind of medical care that the aging population is going to need. In order to meet the US citizens’ medical needs, approximately between 46,000 and 90,000 physicians increased by 2025, the U.S. authorities must act now because training a doctor takes between five and ten years. This article particularly pointed out that there needs to be an increase in US federal funding for graduate medical education and training of 3,000 more doctors annually in order to meet healthcare needs. However, first and most, the American Medical Association needs to change its policy (Sputnik).
“The monopoly created by the licensing of physicians has reduced the incentive for research, development, and experimentation, both in medicine and in the organization and provision of services (Shaw, 2011)” and these “medical field” problems can fall in