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Assessing the degree of competitiveness in the market for outpatient hospital services

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  • Topolyan, Iryna
  • Brasington, David
  • Xu, Xu

Abstract

We assess the level of competition in the market for outpatient hospital services in the State of California using popular new empirical industrial organization measures, such as the Bresnahan-Lau method, Lerner index, and the Boone indicator. We match county-level data from Area Health Resources Files (AHRF) with hospital-level data from the California’s Office of Statewide Health Planning and Development (OSHPD). All three methods suggest that hospitals enjoy substantial market power. The relationship between the degree of spatial competition and the average markups is rather weak.

Suggested Citation

  • Topolyan, Iryna & Brasington, David & Xu, Xu, 2019. "Assessing the degree of competitiveness in the market for outpatient hospital services," Journal of Economics and Business, Elsevier, vol. 105(C).
    • Handle: RePEc:eee:jebusi:v:105:y:2019:i:c:s0148619518300821
    DOI: 10.1016/j.jeconbus.2019.03.002
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    More about this item

    Keywords

    Market structure; Outpatient services; Bresnahan-Lau model; Lerner index; Boone indicator;
    All these keywords.

    JEL classification:

    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General

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