Economics is defined as ‘the study of how scarce
resources are or should be allocated’, with microeconomics
examining ‘how production and consumption are organised,
what is produced, and who benefits’ [1] p. 137.
Williams [2] discussed health economics in terms of eight
key areas of focus (see Fig. 1):
A. What influences health (other than health care)?
B. What is health and what is its value?
C. The demand for health care
D. The supply of health care
E. Micro-economic evaluation at treatment level
F. Market equilibrium
G. Evaluation at whole system level
H. Planning, budgeting and monitoring mechanisms.
This framework is used in this paper to discuss the role
of health economics within the New Zealand health system.