Supply and Demand Principles of Nursing Economics Essay
Economic and Financial Knowledge is important for the DNP-Prepared Nurse that facilitates in the understanding of health economics and their interpretation in the context of health as well as health care. Economic models as well as empirical techniques must be applied in health care (Jain, 2007)Supply and Demand Principles of Nursing Economics Essay.
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While analyzing the health care market, the issue of supply and demand comes in to play. It is however important to take in to consideration the special characteristics that are associated with health care in this regard, which ideally makes health care different from other goods and services. The demand for health care is not attributed to pleasure but rather, it is unpleasant thus creating even more pleasure that normal. The demand for health care is intended to enhance health status and health can be considered as a fundamental commodity that people essentially deserve to enhance their wellbeing thus requiring demand for its enhancement. Health lacks the characteristics that are associated with conventional products and services since people need it and are ready to pay for any improvements in health services. It is also in the context of the willingness of people to access it Supply and Demand Principles of Nursing Economics Essay.
The forces of supply in health care can be explained using perfect competition and monopoly theoretical models in a market structure. In the perfect competition model, many firms exist in the industry thus denying any one single firm the real economic power (Henderson, 2008)Supply and Demand Principles of Nursing Economics Essay. None of the firms is able to make huge profits because prices are extremely low while the output is high. On the other hand, the monopoly market structure is characterized by a single firm in the industry thus has a high market power that facilitates making of huge profits, with low output and higher prices of goods and services.