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Income effects and physician labour supply: evidence from the threshold system in Ontario

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Author Info

  • Jasmin Kantarevic
  • Boris Kralj
  • Darrel Weinkauf

Abstract

We examine a reform to the physician threshold system in Ontario that provides a unique opportunity to assess the effect of fee changes on physician behaviour, free from the biases that potentially affect simple time-series or cross-section inference. We find that: (1) the income effects of fee changes are small, but significant; (2) the income effect dominates the substitution effect only for a minority of services with relatively low prices and high volumes; and (3) the cross effects of fee changes tend to be significant only for services with relatively high prices and low volumes.

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Bibliographic Info

Article provided by Canadian Economics Association in its journal Canadian Journal of Economics.

Volume (Year): 41 (2008)
Issue (Month): 4 (November)
Pages: 1262-1284

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Handle: RePEc:cje:issued:v:41:y:2008:i:4:p:1262-1284

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Cited by:
  1. Sung-Hee Jeon & Jeremiah Hurley, 2010. "Physician Resource Planning in Canada: The Need for a Stronger Behavioural Foundation," Canadian Public Policy, University of Toronto Press, vol. 36(3), pages 359-375, September.
  2. Kantarevic, Jasmin & Kralj, Boris & Weinkauf, Darrel, 2010. "Enhanced Fee-for-Service Model and Access to Physician Services: Evidence from Family Health Groups in Ontario," IZA Discussion Papers 4862, Institute for the Study of Labor (IZA).

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