Citation

Discussion Paper Details

Please find the details for DP14292 in an easy to copy and paste format below:

Full Details   |   Bibliographic Reference

Full Details

Title: Who benefits when inertia is reduced? Competition, quality and returns to skill in health care markets

Author(s): Sebastian Fleitas

Publication Date: January 2020

Keyword(s): Competition, inertia, Quality and Returns to skill

Programme Area(s): Industrial Organization

Abstract: Increased competition creates incentives for health-care providers to improve quality by incorporating better inputs, like higher-skill physicians. However, because the supply of high-skill physicians is relatively inelastic in the short run, increases in competition may lead only to increases in returns to skill. I leverage a reform in Uruguay that increased competition among completely vertically integrated providers by reducing lock-in of consumers. Using administrative data on wages and hours and a measure of physicians' skills based on test scores from medical school, I show that increased competition increased the returns to skill without strong evidence of an increase in quality.

For full details and related downloads, please visit: https://cepr.org/active/publications/discussion_papers/dp.php?dpno=14292

Bibliographic Reference

Fleitas, S. 2020. 'Who benefits when inertia is reduced? Competition, quality and returns to skill in health care markets'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=14292