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CSIO Electronic Working Papers, Northwestern University >
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http://hdl.handle.net/10419/23466
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| Title: | | Entry Deterrence in Hospital Procedure Markets: A Simple Model of Learning-by-Doing  |
| Authors: | | Dafny, Leemore |
| Issue Date: | | 2003 |
| Series/Report no.: | | CSIO working paper / Northwestern University, Center for the Study of Industrial Organization 0037 |
| Abstract: | | This paper examines the strategic behavior of hospitals in one of their primary output markets: inpatient surgical procedures. High levels of learning-by-doing in surgical fields may act as a barrier to entry. I investigate whether incumbent hospitals facing prospective entry in a procedure market manipulate their procedure volumes to produce such a barrier. I derive straightforward empirical tests from a model of patient demand, procedure quality, and di.erentiated product competition. Using hospital data on electrophysiological studies, an invasive cardiac procedure, I find evidence of entry-deterring investment in procedure volume. These findings suggest that competitive motivations may play a role in treatment decisions. |
| Document Type: | | Working Paper |
| Appears in Collections: | | CSIO Electronic Working Papers, Northwestern University
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