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Moonlighting: Public Service and Private Practice

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Author Info
Gary Biglaiser () (Department of Economics, University of North Carolina)
Ching-to Albert Ma () (Department of Economics, Boston University)

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Abstract

We study dual job incentives with a focus on public-service physicians referring patients to their private practices. We call this moonlighting. Not all physicians moonlight; we introduce a group of dedicated doctors who in the base models behave sincerely in the public system. Allowing moonlighting always enhances aggregate consumer welfare. The equilibrium care quality in the public system may increase or decrease; in the former situation, the policy allowing moonlighting improves each consumer’s expected utility. Unregulated moonlighting may be detrimental to consumer welfare when it leads to adverse behavioral reactions such as moonlighters shirking more in the public system, and dedicated doctors abandoning their sincere behavior. Price regulation in the private market tradeoffs the efficiency gain from moonlighting against the loss due to adverse behavior in the public system and improve consumer welfare.

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Paper provided by Boston University - Department of Economics in its series Boston University - Department of Economics - Working Papers Series with number WP2006-015.

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Length: 35pages
Date of creation: Mar 2006
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Handle: RePEc:bos:wpaper:wp2006-015

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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Dolado, Juan José & Felgueroso, Florentino, 2008. "Occupational Mismatch and Moonlighting among Spanish Physicians: Do Couples Matter?," IZA Discussion Papers 3419, Institute for the Study of Labor (IZA). [Downloadable!]
  2. Juan J. Dolado & Jesús Gonzalo & Laura Mayoral, 2005. "What is What?: A Simple Time-Domain Test of Long-memory vs. Structural Breaks," Economics Working Papers 954, Department of Economics and Business, Universitat Pompeu Fabra. [Downloadable!]
  3. Katsumi Shimotsu, 2006. "Simple (but effective) tests of long memory versus structural breaks," Working Papers 1101, Queen's University, Department of Economics. [Downloadable!]
  4. Laura Mayoral, 2005. "Is the observed persistence spurious? A test for fractional integration versus short memory and structural breaks," Economics Working Papers 956, Department of Economics and Business, Universitat Pompeu Fabra. [Downloadable!]
  5. Derek Bond & Michael J. Harrison & Niall Hession & Edward J. O'Brien, 2006. "Some Empirical Observations on the Forward Exchange Rate Anomaly," Trinity Economics Papers tep2006, Trinity College Dublin, Department of Economics. [Downloadable!]
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