For many years, health policy in wealthy countries has rested on the assumption that health-care consumption is not productive and that it does relatively little to produce better health. Researchers comparing health consumption from country to country have largely failed to find a relationship between it and actual health outcomes. This study shows that it is time to rethink this conventional wisdom, in particular as it relates to pharmaceutical consumption.

Richard D. Miller Jr. is a senior research analyst at the Institute for Public Research within the Center for Naval Analyses (CNA) Corporation in Alexandria, Virginia. He has also served as an economist for the Bureau of Labor Statistics in Washington, D.C. H. E. Frech III is a professor of economics at the University of California--Santa Barbara, and an adjunct professor at Sciences Po in Paris. Earlier he served as an economist in the predecessor of the U.S. Department of Health and Human Services.