Why has medicine expanded? The role of consumers

Abstract

In the past 50. years, the field of medicine has expanded dramatically in many Western societies. Despite substantial improvements in objective health measures, there has not been a commensurate increase in assessments of subjective health. We hypothesize that medical expansion may lower people's subjective health perceptions, leading to an increase in health care utilization, and, in turn, fueling further medical expansion. We use OECD (Organization for Economic Co-operation and Development) Health Data, World Development Indicators, the World Values Survey, and the European Values Study to fit a difference-in-differences model that removes unobserved cross-national heterogeneity and any period trend that is shared across nations. We find that three dimensions of medical expansion at the societal level (medical investment, medical professionalization/specialization, and an expanded pharmaceutical industry) negatively affect individual subjective health. These findings are robust to different model specifications. We conclude by discussing possible explanations for the adverse effect of medical expansion on subjective health, and how this effect may be related to other mechanisms through which medicine expands.