f intervention will depend upon a number of factors. The reason for this in Groenewegen's (1990,13) view was that while the provision of goods with a high degree of public good charactoristics was a government function, the fuction of government was not confined soley to the provision of these goods, other factors including, institutional, political, and economic chioces were also important. One product that can be provided both publically and privately and whose provision demonstrates how a market can fail, is health care. The provision of health care has been a major issue for all governments within the last fifty years, with the arguements for private, as opposed to public provision remaining a major issue on the political agenda.Le grand (1992,44 ) believed that one of the major differences between health care and other commodities was the imbalance between the knowledge of the supplier and the knowledge available to the consumer,which is termed Inperfect Information. S. Sax (1990,149) argued that consumers have little knowledge or information about the diagnostic and treatment processes involved, while providers held a large amount of knowledge. Le Grand (1992,45) argued that if market was to allocate health care, the market would fail, as consumers would seek to form long term relationships with providers. These relationships have the effect of limiting the requirement for competition between providers of health care, as consumers do not possess the information nor the incentive to 'shop around' for health care services. Health care, unlike other commodities is subject to uncertainty of demand by consumers. An individual is generally unable to predict when they may require health care, thus making planning or provision for the purchase of care difficult. The market has a mechanism for coping with this uncertainty, namely insurance. Health insurance has two specific difficulties associated with it's provision th...
