Physicians' Services and the Division of Labor across Local Markets
This paper reports empirical evidence of systematic cross-locale variation in the degree of division of labor among physicians. A theoretical model-based on an individual producer's trade-off between increasing returns and falling marginal revenue within each activity-motivates the empirical tests. At two levels of aggregation, specialization is correlated with local demand shifters for medical services. At the individual level, the author finds systematic differences in the range of procedures performed within a specialty class. General practitioners working fewer hours, practicing in more populated counties, or practicing in counties with more elderly produce a narrower range of procedures. Copyright 1988 by University of Chicago Press.
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