This text is a revised and extended version of a Master of Economic Studies thesis entitled Economics and Mental Health Care: Outputs and Implications for Government , that was presented to The University of Queensland in 1989. The purpose of that thesis was, and thus, the purpose of this present study is, to analyze and clarify some aspects of economic behaviour and policy arising from mental illnesses and disorders. The study treats seriously the preferences of people with mental illness. It uses the tools of conventional economic theory to approach the issue of where the preferences of individuals need to be over-ridden for legal or medical reasons. It then integrates this issue of intervention with an analysis addressing another aspect of the issue. The second dimension is that when no legal or medical reason exists to intervene in preferences, the needs and the wants of people with mental illness and their care-givers in contemporary society are being neglected. Although the focus is on mental health care, the approach of this text is unambiguously economic.