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A developed theoretical model of paid and unpaid work in healthcare supply

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  • Yan Feng

    ()
    (Office of Health Economics)

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    Abstract

    We investigate how the increase in the rate of performance related payment affects the healthcare supply in paid and unpaid work. The developed theoretical model shows that a higher price incentivises the supply of paid work. Its impact on unpaid work is determined by the trade-off between crowding effect, effects of the increased opportunity costs and available income. This note provides one of the first attempts in health economics to incorporate the crowding effect and opportunity costs of supply unpaid work into health providers' utility functions and to consider the effect of a change in income within this theoretical framework.

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    File URL: http://www.accessecon.com/Pubs/EB/2012/Volume32/EB-12-V32-I4-P295.pdf
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    Bibliographic Info

    Article provided by AccessEcon in its journal Economics Bulletin.

    Volume (Year): 32 (2012)
    Issue (Month): 4 ()
    Pages: 3082-3089

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    Handle: RePEc:ebl:ecbull:eb-12-00694

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    Related research

    Keywords: unpaid work; financial incentives; crowding effect; time allocation;

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    1. Siciliani, Luigi, 2009. "Paying for performance and motivation crowding out," Economics Letters, Elsevier, vol. 103(2), pages 68-71, May.
    2. Chalkley, Martin & Malcomson, James M., 1998. "Contracting for health services when patient demand does not reflect quality," Journal of Health Economics, Elsevier, vol. 17(1), pages 1-19, January.
    3. Le Grand, Julian, 2003. "Motivation, Agency, and Public Policy: Of Knights and Knaves, Pawns and Queens," OUP Catalogue, Oxford University Press, number 9780199266999, September.
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