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Altruism heterogeneity, quality competition and horizontal differentiation among healthcare providers

Author

Listed:
  • Nadja Kairies-Schwarz

    (Institute for Health Services Research and Health Economics, Heinrich-Heine-University Düsseldorf)

Abstract

Recent empirical evidence shows substantial altruism heterogeneity among healthcare providers. Spurred by this evidence, we build a quality competition model with altruism heterogeneity among healthcare providers that also endogenously determine the degree of horizontal differentiation within the healthcare provision market. We find that relatively more altruistic healthcare providers treat more patients and provide higher quality per patient. In addition, we show that when healthcare providers endogenously choose their location, the more altruistic provider locates more centrally. In terms of specialization this indicates that more altruistic providers can afford to engage in less horizontal differentiation.

Suggested Citation

  • Nadja Kairies-Schwarz, 2023. "Altruism heterogeneity, quality competition and horizontal differentiation among healthcare providers," Economics Bulletin, AccessEcon, vol. 43(2), pages 1143-1154.
    • Handle: RePEc:ebl:ecbull:eb-22-00526
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    File URL: http://www.accessecon.com/Pubs/EB/2023/Volume43/EB-23-V43-I2-P95.pdf
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    References listed on IDEAS

    as
    1. Philippe Choné & Ching-To Albert Ma, 2011. "Optimal Health Care Contract under Physician Agency," Annals of Economics and Statistics, GENES, issue 101-102, pages 229-256.
    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. Heyes, Anthony, 2005. "The economics of vocation or 'why is a badly paid nurse a good nurse'?," Journal of Health Economics, Elsevier, vol. 24(3), pages 561-569, May.
    4. repec:adr:anecst:y:2011:i:101-102:p:11 is not listed on IDEAS
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    More about this item

    Keywords

    healthcare provider; quality competition; altruism heterogeneity;
    All these keywords.

    JEL classification:

    • I1 - Health, Education, and Welfare - - Health
    • D4 - Microeconomics - - Market Structure, Pricing, and Design

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