Abstract
We develop a theoretical model to study a policy that publicly reports hospital waiting times. We characterize two effects of such a policy: the ‘competition effect’ that drives hospitals to compete for patients by increasing service rates and reducing waiting times and the ‘signaling effect’ that allows patients to distinguish a high-quality hospital from a low-quality one. While for a low-quality hospital both effects help reduce waiting time, for a high-quality hospital, they act in opposite directions. We show that the competition effect will outweigh the signaling effect for the high-quality hospital, and consequently, both hospitals' waiting times will be reduced by the introduction of the policy. This result holds in a policy environment where maximum waiting time targets are not binding.
Original language | English |
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Pages (from-to) | 1355-1371 |
Number of pages | 17 |
Journal | Health Economics (United Kingdom) |
Volume | 25 |
Issue number | 11 |
DOIs | |
Publication status | Published - 1 Nov 2016 |