Why Should We Subsidize Medical Education? Health Manpower Policy Discussion Paper Series No.: A6.

This document investigates whether medical education should be subsidized by federal funds. The first chapter discusses the growing debate over medical school financing. Chapter two reviews subsidies, equity, and social welfare. Chapter three gives four rationales for public subsidies, including market structure, slipovers, inappropriate prices, and risk and imperfect information. Chapter four discusses medical education and competition. Conclusions indicate that the present level of public support for medical education is excessive. Federal subsidies should be reduced while medical students should be expected to pay a much larger proportion of their educational costs. (MJM)