Over 1 million people travel to Asia each year to receive healthcare, contributing some US$2 billion to the region's economy. Over 30% of the UK's health workforce is of foreign origin. Over 50% of the doctors trained in Ghana emigrate. Cuba is a regional hub for tele-radiology services. Private companies from India, Singapore and elsewhere invested more than US$1 billion last year in establishing hospitals or other ventures abroad (Smith et al., 2007).
As the global movement of goods, services, capital and people grows, what will be the impact on health systems and population health? What will be the implication of increased economic liberalization in other sectors on the health sector and on population health? What impact do health issues, such as infectious disease or obesity, have on non-health sectors? How well placed is health economics to address such questions? What advice would health economists give to policymakers facing these issues?
In contrast to economists working in other sectors, health economics curricula and research predominantly concern micro-economic analysis within the health sector (notwithstanding some important cross-sectoral work on the determinants of health, and cross-country appraisal of health systems). This editorial argues that such a narrow methodological and geographic focus will be insufficient for health economics to remain relevant to health policy in the 21st century. It is suggested that globalization has, and will increasingly have, significant effects on health and healthcare, and that the challenge facing health economics is to engage with the issues this raises.
But first, what is 'globalization', and what does it have to do with health? Broadly speaking, globalization refers to the temporal and spatial compression of human interaction through advances in travel and telecommunications. Critically, it results in an accelerated expansion of worldwide economic relationships between nations, the key features of which are the increased opening of economies to trade (market liberalization), the cross-border flow of goods, services, capital, people and ideas, and the international institutions, rules and agreements that govern that flow (Lee, 2003). Discussion of globalization tends to be emotive and polarized -bringing increasing standards of living for all or the exploitation of the poor and destruction of indigenous cultures (Smith, 2006a). Nonetheless, this process is continuing and growing, and will affect health through three main channels.
First, globalization will impact upon the general economic circumstances of the country concerned. Increasing trade liberalization has the potential to impact health positively, through increased economic growth and wider availability of goods with a positive impact on health, as well as negatively, through reduced tariffs on, and increased market penetration of, 'bads' such as tobacco, alcohol and firearms. Increasing trade liberalization will also impact the health sector, such as through changes in the exchange rate determining the cost of imported health-related goods and services, such as vaccines and other drugs, and influencing government income, and hence the ability of governments to fund public sector healthcare. However, little is known about the direction and, especially, the magnitude, of the relationship between liberalization and health (Smith, 2006b).