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Competition, Equity and Quality in HealthCare

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  • Halonen-Akatwijuka, Maija
  • Propper, Carol

Abstract

In this paper we focus on the implications of consumer heterogeneity for whether competition will improve outcomes in health care markets. We show that competition generally favours the majority group as higher quality for the majority is an effective way to increase the quality signal and attract patients. A regulator who is concerned about equity may protect the minority group by not introducing competition. Alternatively, if the minority group is favoured by the providers under monopoly, competition can improve equity by forcing the providers to increase quality for the majority group.

Suggested Citation

  • Halonen-Akatwijuka, Maija & Propper, Carol, 2013. "Competition, Equity and Quality in HealthCare," CEPR Discussion Papers 9325, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:9325
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    References listed on IDEAS

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    Cited by:

    1. Rune Stenbacka & Mihkel Tombak, 2014. "Optimal Co-Payment Policy In Health Care: Competition, Ownership Structure And Quality Provision," Working Papers 140004, Canadian Centre for Health Economics.
    2. Rita Santos & Hugh Gravelle & Carol Propper, 2013. "Does quality affect patients’ choice of doctor? Evidence from the UK," Working Papers 088cherp, Centre for Health Economics, University of York.

    More about this item

    Keywords

    competition; equity; hospitals; quality;

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality
    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship

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