I was intrigued by this article by Stanford and MIT professors, Liran Einav, Amy Finkelstein, and Atul Gupta in the most recent issue of the American Economic Review (ungated version here). We are all aware that Americans spend a lot on health care, but there seems to be a lot of disagreement as to why. Some say it's too much government regulation. Others say too little. These authors point out, however, that spending on pet health care roughly mirrors that on humans despite the fact that this is a largely unregulated industry.
The authors write:
“The fact that despite these differences—often mentioned as potential explanations for the large and rapidly growing health-care sector in the United States—some pet health-care patterns appear qualitatively quite similar to the analogous human health-care pattern, strikes us as noteworthy. It should give us pause before attributing the large and rising health-care costs in the United States solely to the prevalence of insurance and government involvement. The similar growth patterns in US human and pet health care may also suggest that technological change in human health care may have spillover effects on related sectors, including perhaps pet health care or human care in other countries.”
A couple figures from the paper.
