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A demand‐induced overtreatment model with heterogeneous experts

Author

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  • Bertrand Crettez
  • Régis Deloche
  • Marie‐Hélène Jeanneret‐Crettez

Abstract

We propose an original game‐theoretic demand‐induced supply model of overtreatment with heterogeneous experts. We show that experts, whatever their abilities, must give the treatment if customers expect them to do so. We show how launching awareness campaigns (on the prudent use of treatment) disseminating information to both the general public and prescribers may, by undermining customers' expectations, reduce overtreatment. Introducing a diagnostic test may have the same effect, but not if its use is costly, especially for good experts. We rely on our model to account for antibiotics overprescription.

Suggested Citation

  • Bertrand Crettez & Régis Deloche & Marie‐Hélène Jeanneret‐Crettez, 2020. "A demand‐induced overtreatment model with heterogeneous experts," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 22(5), pages 1713-1733, September.
    • Handle: RePEc:bla:jpbect:v:22:y:2020:i:5:p:1713-1733
    DOI: 10.1111/jpet.12465
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    References listed on IDEAS

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    Cited by:

    1. Fang Liu & Alexander Rasch & Marco Alexander Schwarz & Christian Waibel, 2020. "The Role of Diagnostic Ability in Markets for Expert Services," CESifo Working Paper Series 8704, CESifo.

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