Perhaps at least according to Tyler Cowen. Here is an excerpt from his Conversation with Dan Wang:
WANG: …health care is what, 20% of the American GDP?
COWEN: 17 point something. That’s a lot, right?
WANG: That’s a lot. That feels too high to me. I feel like we should be ringing better efficiencies out here.
COWEN: It seems not high enough, though, by another standard. You only get that much happier moment to moment. If you live longer, or you have better pain killers, or we can fix your broken hip, your life is a lot better. Why shouldn’t it be eventually 30%, 35%?
WANG: Yes, I don’t know. Should we be spending 35% of GDP on health care, double our share?
COWEN: In 30 years, yes.
Cowen’s point was less about arguing for a specific number, but more than consumptions on good and services may increase your utility only so much. However, if spending on health care can prolong your life and help you live pain/illness-free, the demand for that is likely unlimited. An interesting argument.
Do you agree with it?
