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The Demand for Physician Services. Evidence from a Natural Experiment

  • Bart COCKX

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))

  • Carine BRASSEUR

This study exploits a natural experiment in Belgium to estimate the effect of co-payment increases on the demand for physician services. It shows how a differences-in-differences estimator of the price effects can be decomposed into effects induced by the common average proportional price increase (income effects) and by the change in relative prices (substitution effects). The price elasticity of a uniform proportional price increase is relatively small (-.13 for mean and -.03 for woman). Substitution effects are large, especially for women, but imprecisely estimated. Despite the substantial price increases, the efficiency gain of the reform, if any, is modest

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Paper provided by Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) in its series Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) with number 2001027.

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Length: 37
Date of creation: 01 Oct 2001
Date of revision:
Handle: RePEc:ctl:louvir:2001027
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  15. repec:cup:cbooks:9780521296762 is not listed on IDEAS
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