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Solo versus group practice in the medical profession: The influence of malpractice risk

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  • W. David Bradford

Abstract

While Partnerships are a significant form of business organization in many sectors of the economy, relatively little is known about the incentives which lead to their formation. This paper explores the formation of partnerships among office based physicians when facing some risk of malpractice litigation. Theoretical results indicate that malpractice exposure can increase the incentives to shirk within a partnership, and so exert a significant influence on the decision to form a partnership. Empirical results find that malpractice risk has the expected negative effect on some partnership formation.

Suggested Citation

  • W. David Bradford, 1995. "Solo versus group practice in the medical profession: The influence of malpractice risk," Health Economics, John Wiley & Sons, Ltd., vol. 4(2), pages 95-112, March.
  • Handle: RePEc:wly:hlthec:v:4:y:1995:i:2:p:95-112
    DOI: 10.1002/hec.4730040203
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    Cited by:

    1. 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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