Expansion in markets with decreasing demand‐for‐profits in the German hospital industry
AbstractOver the last 20 years, acute-care hospitals in most OECD countries have built up costly overcapacities. From the perspective of economic policy, it is desirable to know how hospitals of different ownership forms respond to changes in demand and are probably best suited to deal with existing overcapacities. This article examines ownership‐specific differences in the responsiveness to changes in demand for hospital services in Germany between 1996 and 2006. With respect to the speed of adaptation to increasing demand, the study finds for‐profit ownership to be superior to public and nonprofit ownership. However, contrary to other ownership types, for‐profits also tend to expand in markets with decreasing demand – mainly through conversions of publicly owned hospitals. Thus, in short term, the privatization of the hospital sector may slow down the reduction of excess capacities and be therefore socially wasteful. Copyright (C) 2010 John Wiley & Sons, Ltd.
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Bibliographic InfoArticle provided by John Wiley & Sons, Ltd. in its journal Health Economics.
Volume (Year): 20 (2011)
Issue (Month): 6 (June)
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Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749
hospital ownership ; privatization ; hospital market structure ;
Other versions of this item:
- Christoph Schwierz, 2009. "Expansion in Markets with Decreasing Demand – For-Profits in the German Hospital Industry," Ruhr Economic Papers 0106, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
- I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
- I12 - Health, Education, and Welfare - - Health - - - Health Production
- L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs
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