ABSTRACT
This is one type of ‘information problem’ encountered in health markets. More generally, there are many important areas of specialised knowledge involved in the seeking of health status improvement which are not involved in the seeking of a banana.1 As a result, it is inefficient for each consumer (the ‘principal’) to seek out all the relevant information
the widespread use of ‘agents’ such as doctors, physiotherapists, pharmacists, opticians and nutritionists, employed (directly or indirectly) by the consumer to make purchasing decisions on her behalf. This phenomenon is known as ‘agency’, and occurs to different degrees in many fields: law, car mechanics, financial investment, education and numerous others. Almost everywhere there is a ‘professional’, there is an agent in disguise.
