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Asymmetric Information and the Demand for Health Care – the Case of Double Moral Hazard

Author

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  • Udo Schneider

Abstract

The production of health does not only depend on the medical services supplied by the physician but is also influenced by the patient’s compliance. A model of medical treatment is presented in which both the actions of physician and patient are modeled as a productive input. The analysis distinguishes between three cases of strategic interaction. The consequences of asymmetric information between physician and patient are lower activity levels, only in the case of strategic substitutes the result might change. Furthermore, the effects of the implementation of a demand-side coinsurance are discussed.

Suggested Citation

  • Udo Schneider, 2004. "Asymmetric Information and the Demand for Health Care – the Case of Double Moral Hazard," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 124(2), pages 233-256.
    • Handle: RePEc:aeq:aeqsjb:v124_y2004_i2_q2_p233-256
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    Cited by:

    1. is not listed on IDEAS
    2. Udo Schneider & Volker Ulrich, 2007. "Health Relevant Behavior and its Impact on the Physician-Patient Relationship," Working Papers 023, Bavarian Graduate Program in Economics (BGPE).
    3. Udo Schneider & Volker Ulrich, 2008. "The physician-patient relationship revisited: the patient’s view," International Journal of Health Economics and Management, Springer, vol. 8(4), pages 279-300, December.
    4. Udo Schneider, 2005. "Asymmetric Information and Outcome-based Compensation in Health Care – Theoretical Implications," HEW 0501006, University Library of Munich, Germany.
    5. Schneider, Udo & Zerth, Jürgen, 2008. "Improving prevention compliance through appropriate incentives," MPRA Paper 8280, University Library of Munich, Germany.

    More about this item

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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