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Hospital Cost Function In A Non-Market Health Care System

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  • Daniel Bilodeau
  • Pierre-Yves Crémieux
  • Pierre Ouellette

Abstract

This paper examines whether a competitive model of the firm appropriately describes the behavior of hospitals in a non-market environment. This test is based on the best database yet available in the hospital sector. We show that properties of the non-market hospitals'cost functions are compatible with short-term, but not long-term, cost-minimizing behavior. This is consistent with results of similar analyses in the U.S. hospital market and suggests that Québec hospitals, which operate in a non-market environment, might not behave fundamentally differently from their U.S. counterparts. © 2000 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology

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Bibliographic Info

Article provided by MIT Press in its journal The Review of Economics and Statistics.

Volume (Year): 82 (2000)
Issue (Month): 3 (August)
Pages: 489-498

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Handle: RePEc:tpr:restat:v:82:y:2000:i:3:p:489-498

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Cited by:
  1. Heimeshoff, Mareike & Schreyögg, Jonas, 2013. "Estimation of a physician practice cost function," hche Research Papers, Hamburg Center for Health Economics (hche), University of Hamburg 2013/07, Hamburg Center for Health Economics (hche), University of Hamburg.
  2. Ouellette, Pierre & Vierstraete, Valerie, 2004. "Technological change and efficiency in the presence of quasi-fixed inputs: A DEA application to the hospital sector," European Journal of Operational Research, Elsevier, Elsevier, vol. 154(3), pages 755-763, May.
  3. Jean-Philippe Boussemart & Hervé Leleu & Viviane Valdmanis, 2013. "Price of Medicaid and Uncompensated Care compared to Medicare and Private care: A translog shadow pricing approach for Floridian hospital outputs," Working Papers, IESEG School of Management 2013-ECO-02, IESEG School of Management.
  4. Simona VASILACHE & Mihaela Cornelia PREJMEREAN, 2008. "Estimation of the Romanian hospitals efficiency in relation to hospital market competition," Management & Marketing, Economic Publishing House, Economic Publishing House, vol. 3(3), Autumn.
  5. P. Prezerakos & N. Maniadakis & D. Kaitelidou & N. Kotsopoulos & J. Yfantopoulos, 2007. "Measuring Across Hospital Efficiency and Productivity: The Case of Second Regional Health Authority of Attica," European Research Studies Journal, European Research Studies Journal, European Research Studies Journal, vol. 0(1-2), pages 83-96.
  6. Piacenza, Massimiliano & Turati, Gilberto & Vannoni, Davide, 2010. "Restructuring hospital industry to control public health care expenditure: The role of input substitutability," Economic Modelling, Elsevier, Elsevier, vol. 27(4), pages 881-890, July.
  7. Prüfer, J., 2007. "Competition and Mergers among Nonprofits," Discussion Paper, Tilburg University, Tilburg Law and Economic Center 2007-022, Tilburg University, Tilburg Law and Economic Center.
  8. Cremieux, Pierre-Yves & Ouellette, Pierre, 2001. "Omitted variable bias and hospital costs," Journal of Health Economics, Elsevier, Elsevier, vol. 20(2), pages 271-282, March.
  9. Pedro Barros & Sara Machado, 2010. "Money for nothing?," Health Care Management Science, Springer, Springer, vol. 13(3), pages 234-255, September.
  10. Crémieux, Pierre-Yves & Gadbois, Denis & Ouellette, Pierre, 1998. "Une analyse de la performance des CLSC au Québec," L'Actualité Economique, Société Canadienne de Science Economique, Société Canadienne de Science Economique, vol. 74(2), pages 157-181, juin.
  11. Cohen, Jeffrey P. & Morrison Paul, Catherine, 2008. "Agglomeration and Cost Economies for Washington State Hospital Services," Regional Science and Urban Economics, Elsevier, Elsevier, vol. 38(6), pages 553-564, November.
  12. Kathleen Carey & Theodore Stefos, 2011. "Controlling for quality in the hospital cost function," Health Care Management Science, Springer, Springer, vol. 14(2), pages 125-134, June.
  13. Marcelin Joanis & David Boisclair & Claude Montmarquette, 2004. "La santé au Québec : des options pour financer la croissance," CIRANO Project Reports, CIRANO 2004rp-04, CIRANO.
  14. Mike Smet, 2007. "Measuring performance in the presence of stochastic demand for hospital services: an analysis of Belgian general care hospitals," Journal of Productivity Analysis, Springer, Springer, vol. 27(1), pages 13-29, February.
  15. Benoit Dervaux & Gary Ferrier & Herve Leleu & Vivian Valdmanis, 2004. "Comparing French and US hospital technologies: a directional input distance function approach," Applied Economics, Taylor & Francis Journals, Taylor & Francis Journals, vol. 36(10), pages 1065-1081.
  16. Ollinger, Michael & Ralston, Katherine L. & Guthrie, Joanne F., 2011. "School Breakfast and Lunch Costs: Are There Economies of Scale?," 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania, Agricultural and Applied Economics Association 103191, Agricultural and Applied Economics Association.

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