September 12, 2012 2:02PM

Robinson on Arrow and Szasz

With the passing of Cato adjunct scholar Thomas Szasz, it might be worthwhile to share this excerpt from Berkeley economist James C. Robinson’s contribution to a retrospective on Nobel laureate economist Kenneth Arrow’s highly influential 1963 article, “Uncertainty and the Welfare Economics of Medical Care.”

The irony of “Uncertainty and the Welfare Economics of Medical Care” is that it brought to articulation a view of professionalism and the physician‐​patient relationship on the very eve of a massive and largely successful assault on that view and the social relationships it embodied. The decade of Arrow’s article produced a generation of now‐​classic critiques of the principle that patients must rely on trust in the benevolence of physicians for understanding, treatment, and personal coping with their diseases. Medical sociology turned its back on Talcott Parsons (1962) and savaged professional dominance through the writings of Elliot Freidson and his followers. The Boston Women’s Health Book Collective denounced the paternalism and status inequalities inherent in the conventional clinical relationship, founding what became known as the women’s health movement. Thomas Szasz’s denunciation of psychiatry as pseudoscience and a threat to personal freedom launched the mental patients’ rights movement, building on exposés of coercive institutions that embodied the ultimate in asymmetric information between physician and patient. Ivan Illich carried the Szasz framework to the whole of medicine, characterizing medical professionalism as the expropriation of health from the people, the deliberate creation of unequal access to information.

“Uncertainty and the Welfare Economics of Medical Care” was and remains an important article, a spur to thinking and an identifiable starting point for the modern moment in health economics. Its influence pales, however, in comparison to the rich and radical debates spurred by Professional Dominance (Freidson 1970), Our Bodies Ourselves (BWHBC 1969), The Myth of Mental Illness (Szasz 1961), Medical Nemesis (Illich 1976), and the other calls for a new social and clinical contract, a relationship of equals between patients and physicians, the people and the profession. Arrow’s article experienced the fate of many seminal writings, to describe as the present a world that already was past.