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Public Hospital Costs in Two Australian States

Author

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  • Jerome Fahrer
  • Justin G. Fung
  • Ian R. Harper

Abstract

This study examines the long‐run and short‐run behaviour of public hospital average costs in two Australian States: Victoria and Queensland. Using adjusted weighted inlier‐equivalent separations as a measure of hospital output, and floor area as a measure of capacity, the study finds a hump‐ or ‘∩'‐shaped long‐run average cost curve at the 5 per cent significance level in both data sets. The study also finds a saucer‐ or ‘∪'‐shaped relationship between capacity utilisation and short‐run average cost at the 5 per cent level.

Suggested Citation

  • Jerome Fahrer & Justin G. Fung & Ian R. Harper, 2000. "Public Hospital Costs in Two Australian States," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 33(2), pages 182-192, June.
    • Handle: RePEc:bla:ausecr:v:33:y:2000:i:2:p:182-192
    DOI: 10.1111/1467-8462.00146
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    Cited by:

    1. R. Amy Puenpatom & Robert Rosenman, 2006. "Efficiency of Thai provincial public hospitals after the introduction of National Health Insurance Program," Working Papers 2006-2, School of Economic Sciences, Washington State University.

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