Economic Integration


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Lecture8 TheEuropeanModel

Health Care

  • Health Care
  • France: "Under a financial anaesthetic" [Economist, 01/12/02]
  • French health care system rated first among 191 countries by WHO
  • spends under 10% of GDP (US: almost 13% and ranked 37th)
  • Most of doctors' fees paid by state insurance; poor and unemployed get free cover
  • Problem of overuse; share of GDP has risen by more than a quarter over 20 years
  • Future rise in proportion of older people in population
  • Germany: "Is it enough?" [Economist, 6/7/03]
  • Highest spending as % of GDP (11%) of all European countries in the world.
  • Services are free: problem of overuse
  • Demographic shift as in France
  • Proposed Reforms

Source: BBC news In Graphics: Comparing welfare states http://news.bbc.co.uk/2/shared/spl/hi/pop_ups/05/business_comparing_welfare_states/html/1.stm

  • The welfare states of continental Europe and social democratic Sweden seem better at tackling poverty than either the UK or the USA.
  • The effectiveness of welfare states in combating poverty is closely related to how its citizens are prepared to spend.
  • Sweden, where total state spending makes up 60% of the economy, also spends twice as much on social welfare as the United States.
  • Britain falls between the low-spending USA and the high-spending continental European countries.
  • The US stands out as the only industrial country which only provides limited government health care benefits -mainly to the elderly.
  • Other people must buy private health insurance through their employer.
  • Britain's NHS provides a universal service, although not the best-funded one, with particularly generous prescription drug coverage.
  • The most dramatic differences in welfare provision occur in regard to unemployment.
  • Liberal welfare states like the USA and the UK provide a sharp cut-off in benefits to discourage dependency and force people back to work.
  • Germany and France provide generous benefits, and some argue this leads to high unemployment and inflexible labor markets.

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