Nonmarket Resource Allocation in Mental Health Care

Abstract

This article examines the public sector's role in the provision of mental health care, concentrating on a financial and economic perspective. A brief history of U.S. public policy toward the mentally ill is provided. The political economy of the mental health care system is then discussed. Four key sets of actors are identified: voters, interest groups, legislatures and elected politicians, and bureaus and public providers. Public policy toward the mentally ill in the United States is the result of the interaction of these groups. We discuss each group's objectives and the nature of the constraints each faces in pursuing its objectives. Using this perspective, the empirical literature on resource utilization by public mental hospitals is reviewed. A research agenda is presented for analyzing public sources of mental health care.