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Achieving a fair geographical distribution of health-care resources

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  • Mougeot, Michel
  • Naegelen, Florence

Abstract

This paper analyzes the factors determining the physicians’ location decisions when physicians have heterogeneous preferences about the regional amenities in a two-regions health care system. While the first best allocation entails geographic equality in access to and quality of health-care services, we show that free location decisions results in an unfair allocation in health care resources. We first characterize the public policies allowing to decentralize the first best. Then, we show that the optimal policy aiming at equalizing medical densities consists in setting regionally differentiated prices and a single lump-sum transfer. This transfer is a tax (resp. a subsidy) when the value of the difference in regional amenities is low (resp. high).

Suggested Citation

  • Mougeot, Michel & Naegelen, Florence, 2018. "Achieving a fair geographical distribution of health-care resources," Regional Science and Urban Economics, Elsevier, vol. 70(C), pages 384-392.
    • Handle: RePEc:eee:regeco:v:70:y:2018:i:c:p:384-392
    DOI: 10.1016/j.regsciurbeco.2018.03.008
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    More about this item

    Keywords

    Geographic inequality; Physicians' location; Health-care services; Public policy; Regional amenities;
    All these keywords.

    JEL classification:

    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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