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

Information and Quality when Motivation is Intrinsic: Evidence from Surgeon Report Cards

Contents:

Author Info

  • Jonathan T. Kolstad
Registered author(s):

    Abstract

    If profit maximization is the objective of a firm, new information about quality should affect firm behavior only through its effects on market demand. I consider an alternate model in which suppliers are motivated by a desire to perform well in addition to profit. The introduction of quality “report cards” for cardiac surgery in Pennsylvania provides an empirical setting to isolate the relative role of extrinsic and intrinsic incentives in determining surgeon response. Information on performance that was new to surgeons and unrelated to patient demand led to an intrinsic response four times larger than surgeon response to profit incentives.

    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.nber.org/papers/w18804.pdf
    Download Restriction: Access to the full text is generally limited to series subscribers, however if the top level domain of the client browser is in a developing country or transition economy free access is provided. More information about subscriptions and free access is available at http://www.nber.org/wwphelp.html. Free access is also available to older working papers.

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Bibliographic Info

    Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 18804.

    as in new window
    Length:
    Date of creation: Feb 2013
    Date of revision:
    Handle: RePEc:nbr:nberwo:18804

    Note: HC IO PE
    Contact details of provider:
    Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
    Phone: 617-868-3900
    Email:
    Web page: http://www.nber.org
    More information through EDIRC

    Related research

    Keywords:

    Find related papers by JEL classification:

    This paper has been announced in the following NEP Reports:

    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. Henry Sauermann & Wesley M. Cohen, 2008. "What Makes Them Tick? Employee Motives and Firm Innovation," NBER Working Papers 14443, National Bureau of Economic Research, Inc.
    2. David M. Cutler & Robert S. Huckman & Jonathan T. Kolstad, 2009. "Input Constraints and the Efficiency of Entry: Lessons from Cardiac Surgery," Harvard Business School Working Papers, Harvard Business School 10-011, Harvard Business School.
    3. Dranove, David & Sfekas, Andrew, 2008. "Start spreading the news: A structural estimate of the effects of New York hospital report cards," Journal of Health Economics, Elsevier, Elsevier, vol. 27(5), pages 1201-1207, September.
    4. Ellis, Randall P. & McGuire, Thomas G., 1986. "Provider behavior under prospective reimbursement : Cost sharing and supply," Journal of Health Economics, Elsevier, Elsevier, vol. 5(2), pages 129-151, June.
    5. David Dranove & Mark A. Satterthwaite, 1992. "Monopolistic Competition When Price and Quality are Imperfectly Observable," RAND Journal of Economics, The RAND Corporation, vol. 23(4), pages 518-534, Winter.
    6. Akerlof, George A, 1970. "The Market for 'Lemons': Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 84(3), pages 488-500, August.
    7. Martin Gaynor, 2006. "What Do We Know About Competition and Quality in Health Care Markets?," NBER Working Papers 12301, National Bureau of Economic Research, Inc.
    8. Oriana Bandiera & Iwan Barankay & Imran Rasul, 2005. "Social Preferences and the Response to Incentives: Evidence from Personnel Data," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 120(3), pages 917-962, August.
    9. Robert S. Huckman, 2005. "Hospital Integration and Vertical Consolidation: An Analysis of Acquisitions in New York State," NBER Working Papers 11379, National Bureau of Economic Research, Inc.
    10. Robert S. Huckman & Gary P. Pisano, 2006. "The Firm Specificity of Individual Performance: Evidence from Cardiac Surgery," Management Science, INFORMS, INFORMS, vol. 52(4), pages 473-488, April.
    11. Michael Chernew & Gautam Gowrisankaran & Dennis P. Scanlon, 2001. "Learning and the Value of Information: Evidence From Health Plan Report Cards," NBER Working Papers 8589, National Bureau of Economic Research, Inc.
    12. Anil R. Doshi & Glen W.S. Dowell & Michael W. Toffel, 2011. "How Firms Respond to Mandatory Information Disclosure," Harvard Business School Working Papers, Harvard Business School 12-001, Harvard Business School, revised Jun 2012.
    13. Frank, Richard G. & Zeckhauser, Richard J., 2007. "Custom-made versus ready-to-wear treatments: Behavioral propensities in physicians' choices," Journal of Health Economics, Elsevier, Elsevier, vol. 26(6), pages 1101-1127, December.
    14. Cutler, David & Landrum, Mary Beth & Huckman, Robert, 2004. "The Role of Information in Medical Markets: An Analysis of Publicly Reported Outcomes in Cardiac Surgery," Scholarly Articles 2640582, Harvard University Department of Economics.
    15. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, Cambridge University Press, number 9780521766555.
    16. Amy Finkelstein & James Poterba, 2006. "Testing for Asymmetric Information Using 'Unused Observables' in Insurance Markets: Evidence from the U.K. Annuity Market," NBER Working Papers 12112, National Bureau of Economic Research, Inc.
    17. Steven Salop & Joseph Stiglitz, 1977. "Bargains and ripoffs: a model of monopolistically competitive price dispersion," Special Studies Papers, Board of Governors of the Federal Reserve System (U.S.) 94, Board of Governors of the Federal Reserve System (U.S.).
    18. David M. Cutler & Robert S. Huckman & Mary Beth Landrum, 2004. "The Role of Information in Medical Markets: An Analysis of Publicly Reported Outcomes in Cardiac Surgery," NBER Working Papers 10489, National Bureau of Economic Research, Inc.
    19. McGuire, Thomas G. & Pauly, Mark V., 1991. "Physician response to fee changes with multiple payers," Journal of Health Economics, Elsevier, Elsevier, vol. 10(4), pages 385-410.
    20. Christopher C. Afendulis & Daniel P. Kessler, 2007. "Tradeoffs from Integrating Diagnosis and Treatment in Markets for Health Care," American Economic Review, American Economic Association, American Economic Association, vol. 97(3), pages 1013-1020, June.
    21. Thomas G. McGuire & Mark V. Pauly, 1991. "Physician Response to Fee Changes with Multiple Payers," Papers, Boston University - Industry Studies Programme 0015, Boston University - Industry Studies Programme.
    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. Bingxiao Wu, 2014. "Mismeasurement in Pay-for-Performance: Evidence from an Intervention to Reduce Health Care Spending in China," Departmental Working Papers, Rutgers University, Department of Economics 201409, Rutgers University, Department of Economics.
    2. Martin Gaynor & Kate Ho & Robert Town, 2014. "The Industrial Organization of Health Care Markets," NBER Working Papers 19800, National Bureau of Economic Research, Inc.
    3. Jeffrey E. Harris & Beatriz G. López-Valcárcel & Patricia Barber & Vicente Ortún, 2014. "Efficiency versus Equity in the Allocation of Medical Specialty Training Positions in Spain: A Health Policy Simulation Based on a Discrete Choice Model," NBER Working Papers 19896, National Bureau of Economic Research, Inc.
    4. Nadja Kairies & Miriam Krieger, 2013. "How do Non-Monetary Performance Incentives for Physicians Affect the Quality of Medical Care? – A Laboratory Experiment," Ruhr Economic Papers, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen 0414, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.

    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:nbr:nberwo:18804. 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: ().

    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.