Date of this Version
The Quarterly Journal of Economics
The hospital market is served by firms that are private for-profit, private not-for-profit, and government-owned and operated. I use a plausibly exogenous change in hospital financing that was intended to improve medical care for the poor to test three theories of organizational behavior. I find that the critical difference between the three types of hospitals is caused by the soft budget constraint of government-owned institutions. The decision-makers in private not-for-profit hospitals are just as responsive to financial incentives and are no more altruistic than their counterparts in profit-maximizing facilities. My final set of results suggests that the significant increase in public medical spending examined in this paper has not improved health outcomes for the indigent.
This is a pre-copyedited, author-produced PDF of an article accepted for publication in The Quarterly Journal of Economics following peer review. The version of record - Duggan, M. (2000). Hospital ownership and public medical spending (No. w7789). National bureau of economic research is available online at http://repository.upenn.edu/
Duggan, M. (2000). Hospital Ownership and Public Medical Spending. The Quarterly Journal of Economics, 115 (4), 1343-1373. http://dx.doi.org/10.1162/003355300555097
Date Posted: 27 November 2017
This document has been peer reviewed.