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The impact of the institutional form on the cost efficiency of nursing homes

  • Laura Di Giorgio

    (Department of Economics, University of Lugano)

  • Massimo Filippini

    (Department of Economics, University of Lugano; ETH, Zurich, Switzerland)

  • Giuliano Masiero

    ()

    (Department of Economics and Technology Management, University of Bergamo, Italy; Department of Econonomics, University of Lugano, Switzerland)

In Switzerland, nursing home services are mainly provided by regulated public and private nonprofit organizations. Some of them are created by local governments as foundations. This provides a unique setting to analyze the impact of the institutional form on the performance of nursing homes. We propose a model where the institutional form is represented as a legal constraint which affects managers in the decison-making process. Considering a sample of 44 Swiss Italian nursing homes over a 7-years period (1999-2005), we then disentangle persistent inefficiency due to differences in the institutional form from unobserved heterogeneity. The applied estimation strategy provides more accurate estimates of the impact of the institutional form on nursing homes efficiency, as compared to previous studies. Our results suggest that governmental nursing homes are more costly than private and public foundations. These results are consistent across different model specifications.

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Paper provided by USI Università della Svizzera italiana in its series Quaderni della facoltà di Scienze economiche dell'Università di Lugano with number 1203.

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Length: 24 pages
Date of creation: Mar 2012
Date of revision:
Handle: RePEc:lug:wpaper:1203
Contact details of provider: Web page: https://www.bul.sbu.usi.ch

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