The effect of increased consumer demand on fees for aesthetic surgery: an economic analysis.

ABSTRACT

Economic theory dictates that changes in consumer demand have predictable effects on prices. Demographics represents an important component of demand for aesthetic surgery. Between the years of 1997 and 2010, the U.S. population is projected to increase by 12 percent. The population increase will be skewed such that those groups undergoing the most aesthetic surgery will see the largest increase. Accounting for the age-specific frequencies of aesthetic surgery and the population increase yields an estimate that the overall market for aesthetic surgery will increase by 19 percent. Barring unforeseen changes in general economic conditions or consumer tastes, demand should increase by an analogous amount. An economic demonstration shows the effects of increasing demand for aesthetic surgery on its fees. Between the years of 1992 and 1997, there was an increase in demand for breast augmentation as fears of associated autoimmune disorders subsided. Similarly, there was increased male acceptance of aesthetic surgery. The number of breast augmentations and procedures to treat male pattern baldness, plastic surgeons, and fees for the procedures were tracked. During the study period, the supply of surgeons and consumer demand increased for both of these procedures. Volume of breast augmentation increased by 275 percent, whereas real fees remained stable. Volume of treatment for male pattern baldness increased by 107 percent, and the fees increased by 29 percent. Ordinarily, an increase in supply leads to a decrease in prices. This did not occur during the study period. Economic analysis demonstrates that the increased supply of surgeons performing breast augmentation was offset by increased consumer demand for the procedure. For this reason, fees were not lowered. Similarly, increased demand for treatment of male pattern baldness more than offset the increased supply of surgeons performing it. The result was higher fees. Emphasis should be placed on using these economic relationships to expand the demand for aesthetic surgery.