Competition and waiting times in hospital markets
Working paper
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http://hdl.handle.net/11250/163038Utgivelsesdato
2007-03Metadata
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Sammendrag
This paper studies the impact of hospital competition on waiting times. We use
a Salop-type model, with hospitals that differ in (geographical) location and, potentially,
waiting time, and two types of patients; high-benefit patients who choose
between neighbouring hospitals (competitive segment), and low-benefit patients who
decide whether or not to demand treatment from the closest hospital (monopoly segment).
Compared with a benchmark case of regulated monopolies, we find that hospital
competition leads to longer waiting times in equilibrium if the competitive segment
is sufficiently large. Given a policy regime of hospital competition, the effect of increased
competition depends on the parameter of measurement: Lower travelling costs
increase waiting times, higher hospital density reduces waiting times, while the effect
of a larger competitive segment is ambiguous. We also show that, if the competitive
segment is large, hospital competition is socially preferrable to regulated monopolies only if the (regulated) treatment price is sufficiently high.
Utgiver
Norwegian School of Economics and Business Administration. Department of EconomicsSerie
Discussion paper2007:13