The rising cost of health care in the US is largely due to the country's private health insurance system, according to economist Paul Krugman. As health insurance premiums and costs increase much faster than inflation, more Americans are unable to afford coverage. While market forces aim to reduce costs through competition, in health care these have failed due to inelastic demand for services and limited price transparency. Health policy influences economic policy by determining how much households and businesses must spend on health insurance and care, affecting overall inflation and GDP.