joint costs

Definitions

Economics

  • plural noun costs which are allocated to two products

Health Economics

  • (written as Joint Costs)
    'Is the cost of the animal's feed the cost of the mutton or of the wool?' This is the problem famously posed when a production process (in this case sheep farming) produces joint products. The question as posed is unanswerable (sensibly), though the question 'What is the cost of extra feed?' is answerable when one is considering increasing meat or wool production or changing the combination of the two by slaughtering later or earlier. Fortunately there are few (if any) practical situations that can be usefully informed by asking (let alone trying to answer) the opening question in this entry. In health economics, the classic context for this question has been teaching hospitals, which produce health care services and medical education (and some even produce research out put).
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