What is the use of discussing a man's abstract right to food or medicine? The question is upon the method or procuring and administering them.
(Edmund Burke, Reflections on the Revolution in France)
In Chapter Four I developed the proposition that, if policy-makers were largely ignorant about the exact form of the motivational structures of those who worked in the public sector, they should try to design policies that incorporate robust incentive structures: structures that align knightly and knavish motivations in a fashion that direct the individuals concerned towards producing the desired outcomes. Chapter Five argued that policies should also be designed so as to empower users of public services, on the assumption that users were queens not pawns. But it was also pointed out that there were problems concerning users' poor information base, their possible reasoning incapacity, and their potentially excessive use of the service concerned: problems that meant that unfettered user choice would not always be appropriate.
In this chapter and the next, I put some empirical flesh on the philosophical and economic bones of those arguments by discussing some specific policies in health care and education from their perspective. As noted in Chapter One , it is important to analyse specifics in this way: for only by so doing so can academic analysts escape the charge of avoiding the difficult decisions. So, for instance, it is relatively easy to say that we need robust incentive structures, or to say that user choice needs to be partly restrained; but it is much more difficult to specify what form the incentive structures or choice restrictions might take.
This chapter deals with health care and with two areas where these issues are important: the interface between primary and secondary care, and the payment of hospital specialists. Although the discussion is centred on British institutional structures, the problems addressed, as well as the proposed solutions to them, are of more general application.
Many of the recent debates on the organisational structure of the British National Health Service (NHS) have concerned the issue of incentives,