DP13627 Information shocks and provider responsiveness: evidence from interventional cardiology

Author(s): Daniel Avdic, Bo Lagerqvist, Carol Propper, Johan Vikström, Stephanie von Hinke Kessler Scholder
Publication Date: March 2019
Date Revised: May 2019
Keyword(s): Practice style, Quality of care, response to news
JEL(s): H51, I11, I18, J24, O33
Programme Areas: Labour Economics, Public Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=13627

We examine physician responses to global information shocks and the impact on patient outcomes. We exploit an international "firestorm" over the safety of an innovation in healthcare, drug-eluting stents. We use rich micro-data on interventional cardiologists' use of stents to de- fine and measure responsiveness to news shocks. We find substantial heterogeneity in responsiveness to both good and bad news and an association between speed of response to news and patient outcomes. Patients treated by cardiologists who respond slowly to news shocks have fewer adverse outcomes. These results cannot be attributed to financial incentives, patient-physician sorting or heterogeneity in skill.