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Competence in Health Care - An Industrial Systems Analysis Using Competence Bloc Theory to Compare European and US Health Care


  • Eliasson, Gunnar

    () (Royal Institute of Technology)

  • Eliasson, Åsa

    (VitiGen AG)


While European health care systems are mostly public and similar the contrast is large to the US health industry based to a large extent in the market. Using competence bloc theory the industrial potential of Swedish and European health care is assessed and compared with US health industry. To get the the analysis properly framed health industry is defined to include health insurance, health care and the supporting biotech, pharmaceutical and medical instrument industries. A gradually aging industrialized world makes wealthy customers demand the sophisticated life quality enhancing medical support new technology offers. The overwhelming influence of substitute customership in Europe, through politicians, social insurance, doctors etc., however, holds back development through suppressing the preferences of the true customer (the patient), discouraging innovative product competition and entrepreneurship. The larger part of cost escalation in US health care can be attributed to quality improvements, and luxury health care has stimulated innovative product development. While Swedish health care so far has been a technological winner, commercial competence to become internationally competitive is lacking. It appears politically difficult to recognize that private for profit health care may be both more efficient and profitable than publicly run services. However, once competition for profit has been introduced public providers have to improve performance and the differences will disappear.

Suggested Citation

  • Eliasson, Gunnar & Eliasson, Åsa, 2004. "Competence in Health Care - An Industrial Systems Analysis Using Competence Bloc Theory to Compare European and US Health Care," Ratio Working Papers 46, The Ratio Institute.
  • Handle: RePEc:hhs:ratioi:0046

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    References listed on IDEAS

    1. Laurence C. Baker & Kenneth S. Corts, 1995. "The Effects of HMOs on Conventional Insurance Premiums: Theory and Evidence," NBER Working Papers 5356, National Bureau of Economic Research, Inc.
    2. Pierre Azoulay, 2003. "Acquiring Knowledge Within and Across Firm Boundaries: Evidence from Clinical Development," NBER Working Papers 10083, National Bureau of Economic Research, Inc.
    3. Laurence C. Baker, 2000. "Managed Care and Technology Adoption in Health Care: Evidence from Magnetic Resonance Imaging," NBER Working Papers 8020, National Bureau of Economic Research, Inc.
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    More about this item


    Health care; Biotechnology; Competence blocs; Experimentally Organized Economy; Entrepreneurship; Industrial Systems analysis; Science Based Industry; Substitute Customers; University Entrepreneurship;

    JEL classification:

    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
    • L43 - Industrial Organization - - Antitrust Issues and Policies - - - Legal Monopolies and Regulation or Deregulation
    • L65 - Industrial Organization - - Industry Studies: Manufacturing - - - Chemicals; Rubber; Drugs; Biotechnology; Plastics
    • L89 - Industrial Organization - - Industry Studies: Services - - - Other

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