Managing markets.

This paper considers the management of markets in the context of the reformed National Health Service (NHS). There are three facets to managing markets: regulating and monitoring markets to ensure that they are competent, managing contracts, and managing agents. The paper considers issues concerned with market structures and entry to and exit from markets; the concept of opportunism is used to explore ways in which self-interested behaviour can operate for good or bad in the setting up of contracts for health care; and factors related to motivating and monitoring agents. The difficulties involved in managing markets are reviewed, and Enthoven is criticized for adopting an over-simplified approach to market management and the abilities of collective agents. The paper concludes by raising questions about the way in which markets are at present being managed in the NHS, and the accountability of purchasers for health care provided and the money spent.