Are We in a Medical Education Bubble Market?

Debt-to-income ratios for new physicians reveal the connection between what physicians can charge patients and what medical schools can charge students. If we aim to reduce the costs of health care, we need to reduce the costs of medical education. In November 1636, the prices of tulip bulbs in the Dutch market rose rapidly from their normal level to the point where a single bulb might sell for 10 times the annual earnings of a typical worker. Just as quickly, in May 1637, tulip-bulb prices returned to their previous values. The causes of this dramatic rise and fall remain in dispute. The event occurred during the Dutch Golden Age, when stock exchanges, central banking, and many of the fundamental structures that govern contemporary capital markets and the approaches deployed by MBAs today were developed. One modern economic analysis suggests that ...