An Available Way for Developing Medical Tourism in Shanghai: A Theoretic Exploration

Medical tourism is growing rapidly and forming a profitable industry which everyone is wanting a share of, as well as Shanghai government. Shanghai government plans to develop medical tourism and takes it as a part of becoming the centre of modern service industry. However, the best hospitals are state owned and they are not competent to do marketing and promotion. So the international clinics affiliated these hospitals face some demand deficiency. If some new hospitals are established to develop the international medical treatment, it is difficult for them to attract patient abroad because lack of reputation. And it is deed the fact that the best doctors all work for hospitals state owned in China which is formed a kind of tradition. So it is difficult for new hospital to attract excellent staffs. An available way is proposed here. We suggest that specialized agencies go abroad to canvass this new breed of big-spending tourists for hospitals, and hospitals provide high quality treatment. This kind of cooperation between them insures specialization, efficiency and scale economic. We employ a dissymmetrical two player game to address how the profits of the business should be allotted between agency and hospital in order to keep the cooperation for long. The result shows the cooperation between agency and hospital is stable on condition that the payoff is allotted between them rightly. We hope the solution in this paper can help guide the practice developing medical tourism.