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Competition within the Firm: Theory Plus Some Evidence from Medical Group Practice

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  • Martin Gaynor

Abstract

Recent work on the economics of the firm and other organizations has emphasized the importance of internal organization and incentives. The issue of competition within the firm has not arisen, however. In this article I construct a model of nonprice competition among members of a professional partnership and test the model with data on medical group practice. The empirical results are consistent with the hypothesis of nonprice competition among members of the firm.

Suggested Citation

  • Martin Gaynor, 1989. "Competition within the Firm: Theory Plus Some Evidence from Medical Group Practice," RAND Journal of Economics, The RAND Corporation, vol. 20(1), pages 59-76, Spring.
    • Handle: RePEc:rje:randje:v:20:y:1989:i:spring:p:59-76
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    Citations

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    Cited by:

    1. Matthieu Cassou & Julien Mousquès & Carine Franc, 2020. "General practitioners’ income and activity: the impact of multi-professional group practice in France," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 21(9), pages 1295-1315, December.
    2. Kappen, Philip, 2011. "Competence-creating overlaps and subsidiary technological evolution in the multinational corporation," Research Policy, Elsevier, vol. 40(5), pages 673-686, June.
    3. Martin Gaynor & Paul Gertler, 1990. "Moral Hazard in Partnerships," NBER Working Papers 3373, National Bureau of Economic Research, Inc.
    4. Thomas J. Miceli & Dennis Heffley, 2002. "Do Hmos Encourage Prevention? An Analysis Of Alternative Health Care Plans," Contemporary Economic Policy, Western Economic Association International, vol. 20(4), pages 429-439, October.
    5. Martin Gaynor, 1994. "Issues in the Industrial Organization of the Market for Physician Services," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 3(1), pages 211-255, March.
    6. Robert Rosenman & Daniel Friesner, 2004. "Scope and scale inefficiencies in physician practices," Health Economics, John Wiley & Sons, Ltd., vol. 13(11), pages 1091-1116, November.
    7. Lise Rochaix & Stéphane Jacobzone, 1997. "L'hypothèse de demande induite : un bilan économique," Économie et Prévision, Programme National Persée, vol. 129(3), pages 25-36.
    8. Julian Birkinshaw & Mats Lingblad, 2005. "Intrafirm Competition and Charter Evolution in the Multibusiness Firm," Organization Science, INFORMS, vol. 16(6), pages 674-686, December.
    9. Lisa C. DeFelice & W. David Bradford, 1997. "Relative inefficiencies in production between solo and group practice physicians," Health Economics, John Wiley & Sons, Ltd., vol. 6(5), pages 455-465, September.
    10. W. Bradford & Robert Martin, 2000. "Partnerships, Profit Sharing, and Quality Competition in the Medical Profession," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 17(2), pages 193-208, September.

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