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Dollars and Performance : Cost Effectiveness of Substance Abuse Treatment in Maine


  • Machado, M.P.


If public funds are allocated efficiently , then an increase in expenditure should improve the performance of substance abuse treatment programs. However, the unconditional correlation between performance and expenditures per patient is non-positive in the data sets used in this paper. One explanation for this seemingly surprising result is that programs that treat more difficult patients receive more resources per patient. This paper addresses this potential endogeneity both theoretically and empirically.

Suggested Citation

  • Machado, M.P., 1998. "Dollars and Performance : Cost Effectiveness of Substance Abuse Treatment in Maine," Papers 85, Boston University - Industry Studies Programme.
  • Handle: RePEc:fth:bostin:85

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    References listed on IDEAS

    1. Bartel, Ann P & Thomas, Lacy Glenn, 1987. "Predation through Regulation: The Wage and Profit Effects of the Occupational Safety and Health Administration and the Environmental Protection Agency," Journal of Law and Economics, University of Chicago Press, vol. 30(2), pages 239-264, October.
    2. Adam B. Jaffe et al., 1995. "Environmental Regulation and the Competitiveness of U.S. Manufacturing: What Does the Evidence Tell Us?," Journal of Economic Literature, American Economic Association, vol. 33(1), pages 132-163, March.
    3. Henderson, J Vernon, 1996. "Effects of Air Quality Regulation," American Economic Review, American Economic Association, vol. 86(4), pages 789-813, September.
    4. Levinson, Arik, 1996. "Environmental regulations and manufacturers' location choices: Evidence from the Census of Manufactures," Journal of Public Economics, Elsevier, vol. 62(1-2), pages 5-29, October.
    5. Gray, Wayne B, 1987. "The Cost of Regulation: OSHA, EPA and the Productivity Slowdown," American Economic Review, American Economic Association, vol. 77(5), pages 998-1006, December.
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    Cited by:

    1. Richard Frank & David S. Salkever, 2000. "Market Forces, Diversification of Activity, and the Mission of No t-for -Profit Hospitals," NBER Chapters,in: The Changing Hospital Industry: Comparing For-Profit and Not-for-Profit Institutions, pages 195-226 National Bureau of Economic Research, Inc.

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    JEL classification:

    • I10 - Health, Education, and Welfare - - Health - - - General
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health


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