Abstract We analyse the effect of competition on quality in hospital markets with regulated prices, considering both introducing (monopoly versus competition) and increasing through either lower transportation costs (increased substitutability) or a higher number hospitals. With semi‐altruistic providers fairly general cost structure, we show that relationship between is generally ambiguous. In contrast to received body theoretical literature, this consistent with, potentially explains,...

In a model of spatial competition, we analyze the equilibrium outcomes in markets where product price is exogenous. Using an extended version Hotelling model, assume that firms choose their locations and quality they supply. We derive optimal set by welfarist regulator. If regulator can commit to prior choice locations, (second‐best) causes overinvestment insufficient degree horizontal differentiation (compared with first‐best solution) if transportation cost consumers sufficiently high....

We analyze how the presence of trade unions affects pattern mergers in an international oligopoly and welfare implications thereof. find that wages for merger participants are always lower when they merge internationally, rather than nationally. Using a model endogenous formation, we firms will internationally equilibrium. There more socially preferred, unless products close substitutes. A “national champion” policy promoting domestic ones is nevertheless never optimal .

Abstract This paper studies the relationship between patients' socio‐economic status and general practitioners' (GPs') service provision by exploiting administrative patient‐level data with information on consultation length, medical tests, fee payments for each visit in Norway over a 5‐year period (2008–2012). To reduce patient heterogeneity, we limit sample to given condition, diabetes type II, that is treated almost exclusively primary care. We estimate GP fixed‐effect models control wide...

Policy makers use reference pricing to curb pharmaceutical expenditures by reducing coverage of expensive branded drugs. In a theoretical analysis we show that the net effect is generally ambiguous when accounting for entry generic producers. Reference shifts demand towards generics but also induces producer become more agressive, which triggers price competition and potentially deters To investigate counter- vailing effects, exploit policy reform in Norway with gradual implementation across...

Abstract We study the effects of a horizontal merger when firms compete on price and quality. In Salop framework with three symmetric firms, several striking results appear. First, merging reduce quality but possibly also price, whereas outside firm increases both As result, average in market increases, Second, benefits more than from merger, can be unprofitable for partners, i.e., “merger paradox” may Third, always reduces total consumer utility (though some consumers benefit), welfare...

Pharmaceutical expenditures are rising rapidly, driven in part by the innovation of highly effective but very expensive drug therapies that treat multiple diseases. While these drugs offer substantial health benefits, payers face a critical trade-off between cost containment and access to new medicines. A key policy question is whether producers should be restricted uniform pricing or allowed use indication-based pricing, where prices vary across patient groups. We analyse how this choice...

We study the competitive effects of combination therapies in pharmaceutical markets, which crucially hinge on additional therapeutic value combinatory use drugs and substitutability with most relevant monotherapy. If is sufficiently large, introduction leads to higher prices and, somewhat paradoxically, may reduce health plan's surplus, defined as total benefits net drug expenditures. firms are allowed coordinate their price setting, this will lead under uniform pricing but lower...

Abstract We exploit gaps between observed and recently forecasted GDP growth in export destinations to estimate the effects of unexpected demand shocks on worker compensation. Using employer–employee panel data, we find that revenues from these are partly transmitted workers form higher average wages, especially close top within‐firm wage distribution. These responses occur both overtime payment base increases. also significant increases bonus‐related pay firms managed by highly skilled...