�� At the core of Kenneth Arrow’s classic 1963 essay on medical uncertainty is a claim that has failed to carry the day among economists. This claim — that physician adherence to an anti-competitive ethic of fidelity to patients and suppression of pecuniary influences on clinical judgment pushes medical markets toward social optimality — has won Arrow near-iconic status among medical ethicists (and many physicians). Yet conventional wisdom among health economists, including several participants in this symposium, holds that this claim is either naive or outdated. Health economists admire Arrow’s article for its path-breaking analysis of market failures resulting from information asymmetry, uncertainty, and moral hazard. But his suggestion that anticompetitive professional norms can compensate for these market failures is at odds with economists’ more typical treatment of professional norms as monopolistic constraints on contractual possibility. Arrow acknowledged that all indusrywide norms of conduct limit the options for economic exchange (Arrow 1972). For some commentators, the fact of such limits is proof enough of the perniciousness of professional norms from an efficiency perspective. Richard Posner (1993) treats the common “ideology” of guild members concerning matters of quality and craftsmanship as a tool for cartelizing production in order to serve the selfinterest of members. 1 Guild ideology, in this view, deceives both its own adherents and the public concerning members’ furtherance of their own 1. Guild ideology, so interpreted, discourages would-be defectors and free riders by persuading them that guild cooperation serves the public good and by shaming deviant guild members as self seeking.