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The Demand for Pediatric Care: An Hedonic Approach

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  • Fred Goldman
  • Michael Grossman

Abstract

The model that we develop is used to analyze properties of the demand functions for quantity and quality. It is then applied to study the demand for pediatric care -- physicians' services rendered to children.2The theoretical model of quantity -- quality substitution provides a frame-work for demand analysis whenever the market for a good is distinguished by a quality component. The analysis is developed within the household production framework of consumer behavior and assumes that parents both demand and produce quality children, where children's health is one aspect of their quality. Thus, the demand curves for pediatric care are derived from the interaction between the demand and production functions of children's health. In the analysis, we emphasize the effects of income, the price of pediatric services, and the time costs of obtaining these services on the quantity (measured in terms of visits) and quality of services demanded.

Suggested Citation

  • Fred Goldman & Michael Grossman, 1979. "The Demand for Pediatric Care: An Hedonic Approach," NBER Working Papers 0134, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:0134
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    1. Makoto Ohta & Zvi Griliches, 1976. "Automobile Prices Revisited: Extensions of the Hedonic Hypothesis," NBER Chapters,in: Household Production and Consumption, pages 325-398 National Bureau of Economic Research, Inc.
    2. Cowling, Keith & Rayner, A J, 1970. "Price, Quality, and Market Share," Journal of Political Economy, University of Chicago Press, vol. 78(6), pages 1292-1309, Nov.-Dec..
    3. Becker, Gary S & Lewis, H Gregg, 1973. "On the Interaction between the Quantity and Quality of Children," Journal of Political Economy, University of Chicago Press, vol. 81(2), pages 279-288, Part II, .
    4. Acton, Jan Paul, 1975. "Nonmonetary Factors in the Demand for Medical Services: Some Empirical Evidence," Journal of Political Economy, University of Chicago Press, vol. 83(3), pages 595-614, June.
    5. Robert T. Michael, 1972. "The Effect of Education on Efficiency in Consumption," NBER Books, National Bureau of Economic Research, Inc, number mich72-1, June.
    6. H. Theil, 1952. "Qualities, Prices and Budget Enquiries," Review of Economic Studies, Oxford University Press, vol. 19(3), pages 129-147.
    7. Steinwald, Bruce & Sloan, Frank A, 1974. "Determinants of Physicians' Fees," The Journal of Business, University of Chicago Press, vol. 47(4), pages 493-511, October.
    8. Nichols, D & Smolensky, E & Tideman, T N, 1971. "Discrimination by Waiting Time in Merit Goods," American Economic Review, American Economic Association, vol. 61(3), pages 312-323, June.
    9. Mahlon R. Straszheim, 1975. "An Econometric Analysis of the Urban Housing Market," NBER Books, National Bureau of Economic Research, Inc, number stra75-1, June.
    10. Robert P. Inman, 1976. "The Family Provision of Children's Health: An Economic Analysis," NBER Chapters,in: The Role of Health Insurance in the Health Services Sector, pages 215-260 National Bureau of Economic Research, Inc.
    11. Goldman, Fred & Grossman, Michael, 1978. "The Demand for Pediatric Care: An Hedonic Approach," Journal of Political Economy, University of Chicago Press, vol. 86(2), pages 259-280, April.
    12. Michael Grossman, 1972. "The Demand for Health: A Theoretical and Empirical Investigation," NBER Books, National Bureau of Economic Research, Inc, number gros72-1, June.
    13. H. S. Houthakker, 1952. "Compensated Changes in Quantities and Qualities Consumed," Review of Economic Studies, Oxford University Press, vol. 19(3), pages 155-164.
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    Cited by:

    1. Richards, Timothy J. & Patterson, Paul M., 2003. "A Bilateral Comparison Of Fruit And Vegetable Consumption: U.S And Canada," 2003 Annual meeting, July 27-30, Montreal, Canada 21891, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    2. Mary Zimmerman Murphy, 1987. "The Importance of Sample Selection Bias in the Estimation of Medical Care Demand Equations," Eastern Economic Journal, Eastern Economic Association, vol. 13(1), pages 19-29, Jan-Mar.
    3. Óscar D. Lourenço & Pedro L. Ferreira, 2005. "Utilization of public health centres in Portugal: effect of time costs and other determinants. Finite mixture models applied to truncated samples," Health Economics, John Wiley & Sons, Ltd., vol. 14(9), pages 939-953.
    4. Stewart, Hayden & Blisard, Noel, 2006. "Household versus Community Effects: Who Really Pays More for Food?," 2006 Annual meeting, July 23-26, Long Beach, CA 21053, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Fleischer, Aliza & Rivlin, Judith, 2006. "Quality, Quantity And Time Issues In Demand For Vacations," Discussion Papers 7173, Hebrew University of Jerusalem, Department of Agricultural Economics and Management.
    6. Chanjin Chung & Diansheng Dong & Todd M. Schmit & Harry M. Kaiser & Brian W. Gould, 2005. "Estimation of price elasticities from cross-sectional data," Agribusiness, John Wiley & Sons, Ltd., vol. 21(4), pages 565-584.
    7. Gilbert R. Ghez & Michael Grossman, 1979. "Preventive Care, Care for Children and National Health Insurance," NBER Working Papers 0417, National Bureau of Economic Research, Inc.
    8. Richards, Timothy J. & Patterson, Paul M., 2000. "New Varieties And The Returns To Commodity Promotion: The Case Of Fuji Apples," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 29(1), April.
    9. Cutler, David M. & Zeckhauser, Richard J., 2000. "The anatomy of health insurance," Handbook of Health Economics,in: A. J. Culyer & J. P. Newhouse (ed.), Handbook of Health Economics, edition 1, volume 1, chapter 11, pages 563-643 Elsevier.
    10. Somanathan, Aparnaa, 2008. "The impact of price subsidies on child health care use : evaluation of the Indonesian healthcard," Policy Research Working Paper Series 4622, The World Bank.
    11. repec:eee:jouret:v:88:y:2012:i:2:p:206-225 is not listed on IDEAS
    12. Martin Gaynor & Solomon Polachek, 1990. "Measuring Ignorance in the Market: A New Method with an Application to Physician Services," NBER Working Papers 3430, National Bureau of Economic Research, Inc.
    13. Goldman, Fred & Grossman, Michael, 1978. "The Demand for Pediatric Care: An Hedonic Approach," Journal of Political Economy, University of Chicago Press, vol. 86(2), pages 259-280, April.
    14. Shou-Lin Yang & Chiung-Ying Lee, 2015. "Analysis of the medical demands of elderly dementia patients considering the caregiver cost of medical accompaniment: an application of the travel cost method and altruistic utility function," Quality & Quantity: International Journal of Methodology, Springer, vol. 49(1), pages 423-439, January.
    15. Avi Dor & Siran M. Koroukian & Michael Grossman, 2004. "Managed Care Discounting: Evidence from the MarketScan Database," NBER Working Papers 10437, National Bureau of Economic Research, Inc.
    16. Jane E. Ruseski & Brad R. Humphreys, 2011. "Participation in Physical Activity and Health Outcomes: Evidence from the Canadian Community Health Survey," Chapters,in: The Economics of Sport, Health and Happiness, chapter 1 Edward Elgar Publishing.
    17. Linda N. Edwards & Michael Grossman, 1979. "Adolescent Health, Family Background, and Preventive Medical Care," NBER Working Papers 0398, National Bureau of Economic Research, Inc.
    18. Fabbri, Daniele & Monfardini, Chiara, 2009. "Rationing the public provision of healthcare in the presence of private supplements: Evidence from the Italian NHS," Journal of Health Economics, Elsevier, vol. 28(2), pages 290-304, March.
    19. Hayden Stewart & Noel Blisard, 2008. "Who Pays More for Food?," Journal of Agricultural Economics, Wiley Blackwell, vol. 59(1), pages 150-168, February.
    20. Joyce, Theodore J. & Grossman, Michael & Goldman, Fred, 1989. "An assessment of the benefits of air pollution control: The case of infant health," Journal of Urban Economics, Elsevier, vol. 25(1), pages 32-51, January.
    21. Gingrich, Chris Daniel, 1995. "Health uncertainty and food consumption in low-income households in Lima, Peru," ISU General Staff Papers 1995010108000012053, Iowa State University, Department of Economics.
    22. Michael Grossman, 2003. "Household Production and Health," Review of Economics of the Household, Springer, vol. 1(4), pages 331-342, December.
    23. Richards, Timothy J. & Patterson, Paul M., 1998. "New Varieties and the Returns to Commodity Promotion: Washington Fuji Apples," Working Papers 28541, Arizona State University, Morrison School of Agribusiness and Resource Management.
    24. Nana Anokye & Subhash Pokhrel & Martin Buxton & Julia Fox-Rushby, 2012. "The demand for sports and exercise: results from an illustrative survey," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 13(3), pages 277-287, June.

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