Utility Maximizing


Health Economics

  • This (or its variant, expected utility maximizing) is the basic motivating drive for human behaviour most frequently used by economists. In some conditions (for example, where there is intense competition for the ownership of a firm) profit maximization is used as a good approximation for what motivates managers of firms and this has also been used in health economics. In general, however, economists tend to take it for granted that the behaviour of health care professionals, the health service organizations in which they work and that of their clients is to be examined under the assumption that they maximize some form of utility function. This does not imply necessarily that the entities pursued by such decision-makers are selfish ones.