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Mainstream health economics labours under a misleading understanding of the nature of the topic area and suffers from a concomitant poverty of thinking about theory and method. The purpose here is to explore this critical position and argue that health economics should aspire to being more than a technical discipline. It can, and should, engage with transformative discourse.

It is argued that the hermeneutic sciences, emphasising interpretation not instrumentality or domination, offer a route into the change to which one seeks to contribute. The article specifically focuses on the way Habermas provides insights in his approach to knowledge, reason and political economy. How he emphasises complexity and interaction within cultural milieu is explored and primacy is given to preserving the life‐world against the encroachments of a narrow rationalization.

The argument for a critical re‐imagining of health economics is presented in three stages. First, the antecedents, current assumptions and critical voices from contemporary economics and health economics are reviewed. Second, the way in which health is best understood via engaging with the complexity of both the subject itself and the society and culture within which it is embedded is explored. Third, the contribution that hermeneutics, and Habermas's critical theory, could make to a new health economics is examined.

The paper offers a radical alternative to health economics. It explores the shortcomings of current thinking and argues an optimistic position. Progress via reason is possible if one reframes both in the direction of communication and in the appreciation of reflexivity and communality. This is a position that resonates with many who challenge prevailing paradigms, in economics and elsewhere.

Health economics is now a well‐established topic within the discipline of economics. A 5,500‐item bibliography covering material up to 1982 is available (Blades et al, 1986). Health economists write on such diverse matters as (to select at random) demand for acute care in hospitals, the costs of illness, the economics of alcoholism, cost‐benefit analysis in magnetic resonance imaging, and the pros and cons of any number of ways of financing the delivery of health services. Here in the UK the Health Economists' Study Group boasts around 150 members. Meanwhile, hardly a day goes by without the newspapers containing items concerning topics which could form the basis for health economists' involvement in analysis, evaluation and, in some cases, policy advice. The jargon of economics and evaluation is becoming familiar to a wider audience: thus articles on cost‐effectiveness and cost‐benefit analysis appear regularly in medical journals and the quality‐adjusted life‐year (QALY) has featured on TV. Thus a review of some of the recently published books in this area would appear appropriate at this juncture.

Statistics for the economics of health care encompasses three enormous subject areas in their own right. In order to make my task more manageable, I have decided not to say very much directly about statistics, as Dr. Alderson of the Office of Population Censuses and Surveys, and Dr John Fry, leading authorities on mortality and morbidity statistics — which are of course essential data in studying many health issues, have given papers at this seminar. Instead, I shall concentrate on the remaining two, economics and health care and in so doing divide my paper into two parts. The first will look at the evolution of health economics and then I shall turn my attention specifically to the work of my own organisation, the Office of Health Economics (OHE).

The purpose of this paper is to propose an alternative, interdisciplinary teaching of health, health care and medical care based on three pillars: social economics, the social determinants of health (SDH) and ethics. Based on these three pillars, the global financial crisis is presented as the moment of manifestation of the SDH at individual and aggregate levels that require a critical analysis from a broader perspective that is possible with social economics and ethics.

The author designed a writing-intensive course based on four modules about definition of health, health care, medical care and determinants of health; political economy of financing and organization of medical care; policies including reform proposals; and medical ethics and moral philosophies that reflect back on the previous topics, respectively.

The course attracts students from different disciplines who found it realistic and comprehensive so that it can be related easily to other disciplines owing to its interdisciplinary design. It also helps students to improve their writing skills.

The course is taught only in US context and is still open to further development.

The theoretical pillars of the course can be adopted and experimented with in different contexts (e.g. wars, plagues, immigration, etc.) and inform the participants about the subject matters from a broader perspective.

This paper provides a successful and novel teaching experience of health and medical care by putting social economics, SDH and ethics together.

The correlation between health care expenditure, gross domestic product (GDP) and population over 65 years (understood as share of the elderly) is a key question for health economics and demographic impact. The purpose of this paper is to study the role of ageing society to curb rising health care expenditures along the Spanish regions over the period 2002-2013, identifying their geographic differences and explain them based on GDP differences.

Cointegration technique is used in order to test if there is a statistically significant connection between variables.

They are similar to some obtained when using unit root test. In particular, the authors find how the elderly positively affects health care expenditure per capita.

The findings suggest that any cooperation policies should aim at improving the access of people to health care services based on public health care expenditures.

To the best of the knowledge this is one of the first studies which suggest different results by Spanish regions due to mature decentralized system in recent years.

The purpose of this paper is to analyse the way in which the factors influencing a transformation towards or away from modularity, according to general modular systems theory, appear in the context of health services, and the extent to which the special characteristics of health services might support or prevent its application.

The arguments constructed in the study are based on the theme of modularity, reflected against the special characteristics of health services identified in the context of health economics.

The results include 11 proposition pairs that direct health services both towards and away from modularity.

Health services are highly heterogeneous in nature and the authors illustrate this with a wide range of examples from elderly care as the authors discuss the application of modularity in this context. Nevertheless, the authors recognise that modularity might suit some health services better than others. The findings provide potentially important information to health service managers and providers, enabling them to understand how modularity would benefit health service provision and where contradictions are to be expected.

This study contributes to the discourse on service modularity in general, and complements the literature on modularity with reference to both public and private health services.

Need has persisted as a central concept in health policy debate. Despite confusion over its meaning and derivation it seems to summarise a belief by many policy makers that the concerns of health policy go beyond the merely economic. Economists, on their side, frequently stop at the borders of economics, leaving the concept of need to others, preferring where possible the concepts of demand and supply. This state of affairs increases the risk that the relationship of health care need to economic theory will not be well understood by policy makers, and that economists will misunderstand why their policy advice, when given, is so frequently ignored.

Michael F. Drummond, in a recent paper in this Journal, has pointed out the usefulness and even necessity of physicians in clinical practice understanding certain key concepts of economics that apply to the provision of medical care. While the clinical practice of medicine and economic theory may appear to be quite unrelated, in fact they share a basic purpose: that of maximising the benefit society as a whole receives from the limited productive capability at hand. Viewed in this way, choices in the provision of medical care are but a subset of all choices that society must make in allocating this limited capability among many competing uses. ‘Economising’ thus is applicable to each component of economic activity, including the provision of medical care. ‘Scarcity’ and ‘opportunity cost’, as defined by Drummond, are the anchors of the bridge joining medical care and economics, and represent the fundamental concepts in the teaching of economic ways of thinking to those who determine the allocation of resources between medical care and other sectors of production, and within medical care. This paper builds on Drummond's ‘teaching approaches’ — his suggestions about where, when, what, and how to proceed until the infusion of this sort of economics education into the medical curriculum — with observations derived from 16 years' experience in teaching health care economics, in many settings, in the United States. It offers them, with due qualification for the differences between the US and UK medical care delivery and financing systems, in the hope that they may prove useful in expanding the teaching of economic concepts to future clinical practitioners and managers in both countries.

Evidence that the productivity of marginal expenditures on health care is low is reviewed. A number of reasons why expenditure on health care continues to be high in the light of such evidence are presented. Priorities for research in health economics are then set out.

The purpose of this paper is to suggest how decision-makers may work towards a broader perspective on value than that expressed in financial economics-based accounting terms to enhance value in healthcare.

The authors review published academic research and reports on practice across a range of disciplines.

The authors find that while value is a multidimensional concept, which is open to perceptions that differ across stakeholders in healthcare, financial economics-based accounting is essentially mono-disciplinary and dominates decisions. Enhancing value in health is a wicked problem, and a trans-disciplinary approach has the potential to enable decision-makers to enhance value.

The suggest that a trans-disciplinary approach, which dissolves disciplinary boundaries, is capable of enabling decision-makers to work towards understanding and enhancing value by fostering awareness of stakeholders' perceptions of value. A critical caveat is that a trans-disciplinary approach does not guarantee ready-made or immediate solutions; it does, however, offer the means to struggle towards a destination which may be continually shifting.

This study highlights the importance of a broader understanding of the concept of value than that implied by financial economics-based accounting and recognises the perceptions of stakeholders. It explores the inter-relationship among “the view from nowhere”, wicked problems and trans-disciplinarity and recommends a trans-disciplinary approach with a view to enhancing value in that broader sense. In this way, it contributes to the accounting literature, which has previously paid little attention to some of these aspects.