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Asymmetric Peer Effects in Physician Prescription Behavior: The Role of Opinion Leaders

  • Nair, Harikesh S.

    (Stanford U)

  • Manchanda, Puneet

    (U of Chicago)

  • Bhatia, Tulikaa

    (Rutgers U)

We quantify the impact of social interactions and peer effects in the context of prescription choices by physicians. Using detailed individual-level prescription data, along with self-reported social network information, we document that physician prescription behavior is significantly influenced by the behavior of research-active specialists, or "opinion leaders" in the physician's reference group. We leverage a natural experiment in the category, whereby new guidelines released about the therapeutic nature of the focal drug generated conditions where physicians were more likely to be influenced by the behavior of specialist physicians in their network. We find important, statistically significant peer effects that are robust across model specifications. We use the estimates to measure the incremental value to firms of directing targeted sales-force activity to these opinion leaders, and present estimates of the social multiplier of detailing in this category.

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File URL: http://gsbapps.stanford.edu/researchpapers/library/RP1970.pdf
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Paper provided by Stanford University, Graduate School of Business in its series Research Papers with number 1970.

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Date of creation: Dec 2006
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Handle: RePEc:ecl:stabus:1970
Contact details of provider: Postal: Stanford University, Stanford, CA 94305-5015
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  1. Brock,W.A. & Durlauf,S.N., 2000. "Discrete choice with social interactions," Working papers 7, Wisconsin Madison - Social Systems.
  2. Oriana Bandiera & Imran Rasul, 2006. "Social Networks and Technology Adoption in Northern Mozambique," Economic Journal, Royal Economic Society, vol. 116(514), pages 869-902, October.
  3. Sendhil Mullainathan & Marianne Bertrand & Erzo F.P. Luttmer, 1998. "Network Effects and Welfare Cultures," Working papers 98-21, Massachusetts Institute of Technology (MIT), Department of Economics.
  4. Emmanuel Saez & Esther Duflo, 2003. "The role of information and social interactions in retirement plan decisions: Evidence from a randomized experiment," Framed Field Experiments 00141, The Field Experiments Website.
  5. Timothy G. Conley & Christopher R. Udry, 2010. "Learning about a New Technology: Pineapple in Ghana," American Economic Review, American Economic Association, vol. 100(1), pages 35-69, March.
  6. repec:att:wimass:9127 is not listed on IDEAS
  7. Esther Duflo & Emmanuel Saez, 2002. "The Role of Information and Social Interactions in Retirement Plan Decisions: Evidence from a Randomized Experiment," NBER Working Papers 8885, National Bureau of Economic Research, Inc.
  8. Charles F. Manski, 2000. "Economic Analysis of Social Interactions," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 115-136, Summer.
  9. Manski, Charles F, 1993. "Identification of Endogenous Social Effects: The Reflection Problem," Review of Economic Studies, Wiley Blackwell, vol. 60(3), pages 531-42, July.
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