Advanced Search
MyIDEAS: Login to save this paper or follow this series

Does an increase in the doctor supply reduce medical fees? An econometric analysis of medical fees across Australia

Contents:

Author Info

  • Jeff Richardson

    ()
    (Centre for Health Economics, Monash University)

  • Stuart Peacock

    (Centre for Health Economics, Monash University)

  • Duncan Mortimer

    ()
    (Centre for Health Economics, Monash University)

Abstract

One of the clearest predictions of economic theory is that an autonomous increase in supply will depress the price which equilibriates supply and demand. However, US evidence with respect to medical fees has been perverse: higher fees have been observed in areas with more doctors even after standardising for other relevant variables. This has resulted in two broad responses. Some have invoked the (once) controversial theory of supplier-induced demand to account for the anomaly. Others have suggested ingenious ways of explaining the results within the orthodox framework in which supply and demand are independent. There has been almost no analysis of price formulation in the Australian medical market. It has been generally assumed that the usual supply demand relationships apply in the Australian context, and that perversity in the US is attributable to US specific market characteristics. The present article examines the setting of GP fees in the Australian market using 1995 cross-section data from statistical sub-divisions. The implications of the results for workforce planning and for the analysis of consumer benefits are discussed.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.buseco.monash.edu.au/centres/che/pubs/wp145.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Monash University, Centre for Health Economics in its series Centre for Health Economics Working Papers with number 145/04.

as in new window
Length: 24 pages
Date of creation: Apr 2004
Date of revision:
Handle: RePEc:mhe:chewps:2004-145

Contact details of provider:
Postal: Centre for Health Economics, Monash University, Building 75, Clayton, Victoria 3800, Australia
Phone: +61-3-9905-0733
Fax: +61-3-9905-8344
Email:
Web page: http://www.buseco.monash.edu.au/centres/che/
More information through EDIRC

Related research

Keywords:

Other versions of this item:

References

References listed on IDEAS
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.:
as in new window
  1. Reinhardt, Uwe E., 1985. "The theory of physician-induced demand reflections after a decade," Journal of Health Economics, Elsevier, vol. 4(2), pages 187-193, June.
  2. Andrew M. Jones, 2012. "health econometrics," The New Palgrave Dictionary of Economics, Palgrave Macmillan.
  3. Horowitz, Joel L., 1994. "Bootstrap-based critical values for the information matrix test," Journal of Econometrics, Elsevier, vol. 61(2), pages 395-411, April.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Stuart Peacock & Jeffrey Richardson, 2007. "Supplier-induced demand: re-examining identification and misspecification in cross-sectional analysis," The European Journal of Health Economics, Springer, vol. 8(3), pages 267-277, September.
  2. Hugh Gravelle & Anthony Scott & Peter Sivey & Jongsay Yong, 2013. "Competition, Prices and Quality in the Market for Physician Consultations," Melbourne Institute Working Paper Series wp2013n23, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
  3. Rita Santos & Hugh Gravelle & Carol Propper, . "Does quality affect patients’ choice of doctor? Evidence from the UK Abstract: Provider competition is a currently popular healthcare reform model. A necessary condition for greater competition to i," The Centre for Market and Public Organisation 13/306, Department of Economics, University of Bristol, UK.
  4. Rita Santos & Hugh Gravelle & Carol Propper, 2013. "Does quality affect patients’ choice of doctor? Evidence from the UK," Working Papers 088cherp, Centre for Health Economics, University of York.
  5. Jackie Cumming & Steven Stillman & Michelle Poland, 2009. "Who Pays What for Primary Health Care? Patterns and Determinants of the Fees Paid by Patients in a Mixed Public-Private Financing Model," Working Papers 09_01, Motu Economic and Public Policy Research.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:mhe:chewps:2004-145. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Teresa Cheong).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.