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The Industrial Organization of Health Care Markets

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  • Martin Gaynor
  • Kate Ho
  • Robert Town

Abstract

The US health care sector is large and growing - health care spending in 2011 amounted to $2.7 trillion and 18% of GDP. Approximately half of health care output is allocated via markets. In this paper, we analyze the industrial organization literature on health care markets focusing on the impact of competition on price, quality and treatment decisions for health care providers and health insurers. We conclude with a discussion of research opportunities for industrial organization economists, including opportunities created by the US Patient Protection and Affordable Care Act.

Suggested Citation

  • Martin Gaynor & Kate Ho & Robert Town, 2014. "The Industrial Organization of Health Care Markets," NBER Working Papers 19800, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:19800
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    2. Sorek Gilad, 2016. "Competition and Product Choice in Option Demand Markets," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 16(2), pages 785-805, April.
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    4. Anne-Fleur Roos & Eddy van Doorslaer & Owen O'Donnell & Erik Schut & Marco Varkevisser, 2018. "Does price competition damage healthcare quality?," Tinbergen Institute Discussion Papers 18-040/V, Tinbergen Institute.
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    6. Lauren Hersch Nicholas & Johanna Catherine Maclean, 2016. "The effect of medical marijuana laws on the health and labor supply of older adults: Evidence from the Health and Retirement Study," NBER Working Papers 22688, National Bureau of Economic Research, Inc.
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    8. Hange, Ulrich, 2015. "The Market for Nursing Homes in Germany: a spatial competition approach," Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112853, Verein für Socialpolitik / German Economic Association.
    9. Besley, Timothy & Malcomson, James M., 2018. "Competition in public service provision: The role of not-for-profit providers," Journal of Public Economics, Elsevier, vol. 162(C), pages 158-172.
    10. Anell, Anders & Dietrichson, Jens & Ellegård, Lina Maria & Kjellsson, Gustav, 2017. "Information, Switching Costs, and Consumer Choice: Evidence from Two Randomized Field Experiments in Swedish Primary Health Care," Working Papers 2017:7, Lund University, Department of Economics, revised 27 Jun 2018.
    11. Böhm, Sebastian & Grossmann, Volker & Strulik, Holger, 2017. "R&D-driven medical progess, health care costs, and the future of human longevity," Center for European, Governance and Economic Development Research Discussion Papers 325, University of Goettingen, Department of Economics.
    12. Dietrichson, Jens & Ellegård, Lina Maria & Kjellsson, Gustav, 2016. "Patient Choice, Entry, and the Quality of Primary Care: Evidence from Swedish Reforms," Working Papers 2016:36, Lund University, Department of Economics, revised 27 Jun 2018.
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    14. Sorek, Gilad, 2016. "Competition and consumer choice in option demand markets," Economics Letters, Elsevier, vol. 146(C), pages 13-16.
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    16. Dardanoni, V.; & Laudicella, M.; & Li Donni, P.;, 2018. "Hospital Choice in the NHS," Health, Econometrics and Data Group (HEDG) Working Papers 18/04, HEDG, c/o Department of Economics, University of York.
    17. Juan Esteban Carranza & Álvaro J. Riascos & Natalia Serna, 2017. "Market Power, Contracts and Outcomes: The Case of Patients with Long-Term Diseases in the Colombian Health Care System," DOCUMENTOS DE TRABAJO QUANTIL 015283, QUANTIL.
    18. Laura Levaggi & Rosella Levaggi, 2017. "Oligopolistic competition for the provision of hospital care," Working papers 57, Società Italiana di Economia Pubblica.
    19. Larry Howard, 2014. "Do the Medicaid and Medicare programs compete for access to health care services? A longitudinal analysis of physician fees, 1998–2004," International Journal of Health Economics and Management, Springer, vol. 14(3), pages 229-250, September.
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    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General

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