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Imitative Pricing: The Importance of Neighborhood Effects in Physicians' Consultation Prices

Author

Listed:
  • Benjamin Montmartin

    (SKEMA Business School
    Université Côte d'Azur
    OFCE Sciences.Po
    GREDEG CNRS)

  • Marcos Herrera-Gomez

    (CONICET - IELDE
    National University of Salta, Argentina)

Abstract

During the last 30 years in France, concerns about healthcare access have grown as physician fees have increased threefold. In this paper, we developed an innovative structural framework to provide new insights into free-billing physician pricing behavior. We test our theoretical framework using a unique geolocalized database covering more than 4,000 private practitioners in three specializations (ophthalmology, gynecology and pediatrics). Our main findings highlight a low price competition environment driven by local imitative pricing between physicians, which increases with competition density. This evidence in the context of growing spatial concentration and an increasing share of free-billing physicians calls for new policies to limit additional fees.

Suggested Citation

  • Benjamin Montmartin & Marcos Herrera-Gomez, 2022. "Imitative Pricing: The Importance of Neighborhood Effects in Physicians' Consultation Prices," GREDEG Working Papers 2022-02, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France.
    • Handle: RePEc:gre:wpaper:2022-02
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    More about this item

    Keywords

    Imitative pricing; Health care access; Local competition; Spatial effects;
    All these keywords.

    JEL classification:

    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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