Counter-productive subsidy of medical schools

Medical schools in some countries receive government subsidies for training doctors. The schools have trained more doctors than are needed to serve local patients. In order to reduce the glut of doctors, the government has told the medical schools to train fewer doctors. The medical schools have claimed that they depend on the subsidies to operate, and so the government is now paying medical schools not to train doctors.

Subsidies for not training doctors were awarded in 1997 in the USA.

1. Overdependence on government subsidies
2. Insufficient educational incentives
3. Disincentives

1. Surplus of medical doctors

1. Reducing production of specialists