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Privatization and Quality: Evidence from Elderly Care in Sweden

  • Spagnolo, Giancarlo


    (Stockholm Institute of Transition Economics)

  • Bergman, Mats A.


    (Södertörn University)

  • Lundberg, Sofia


    (Umeå University)

Many quality dimensions are hard to contract upon and are at risk of degradation when services are procured rather than produced in-house. However, procurement may foster performance-improving innovation. We assemble a large data set on elderly care services in Sweden between 1990 and 2009, including survival rates - our measure of non-contractible quality - and subjectively perceived quality of service. We estimate how procurement from private providers affects these measures using a difference-in-difference approach. The results indicate that procurement significantly increases non-contractible quality as measured by survival rate, reduces the cost per resident but does not affect subjectively perceived quality.

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Paper provided by Stockholm Institute of Transition Economics, Stockholm School of Economics in its series SITE Working Paper Series with number 19.

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Length: 52 pages
Date of creation: 09 Nov 2012
Date of revision:
Handle: RePEc:hhs:hasite:0019
Contact details of provider: Postal: Stockholm Institute of Transition Economics, Stockholm School of Economics, P.O. Box 6501, SE-113 83 Stockholm, Sweden
Phone: (+46 8) 736 9670
Fax: (+46 8) 31 64 22
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