The agency relationship in health care, and the resulting potential for supplier induced demand, has led to much research in health economics. The focus of this research has been on designing and evaluating financial incentive schemes for doctors. The aim of this thesis is to broaden this research by focusing more on the utility functions of patients and doctors, in the context of General Practice. The first half of the thesis concentrates on patients’ utility functions. Empirical work is conducted on patients’ preferences for aspects of the doctor-patient relationship using a discrete choice experiment. The results have implications for the training of doctors in communication skills. As well as broadening the nature of the utility function, this work examines empirically the source of asymmetry of information (i.e. the doctor-patient relationship), rather than its symptoms (i.e. supplier induced demand and the role of financial incentives). The second half of the thesis examines GPs’ utility functions. GPs’ preferences for pecuniary and non-pecuniary job characteristics are elicited, in the context of choosing a General Practice in which to work. Monetary valuations of non-pecuniary job characteristics are presented. This study broadens the nature of the GPs’ utility function and shifts the focus away from the role of financial incentives in influencing behaviour, towards altering non-pecuniary job characteristics. The results have policy implications for encouraging GPs to work in General Practices in under served areas. Patients and doctors make many other decisions in health care that should be the focus of future research. More information on patients’ and doctors’ utility functions is essential if optimal incentives and regulation are to be designed for doctors.