Explicit financial incentives, especially pay-for-performance (P4P) incentives, have been extensively employed in recent years by health plans and governments in an attempt to improve the quality of health care services. This study exploits a natural experiment in the province of Ontario, Canada...

We ask how patient knowledge of appropriate antibiotic usage affects both physicians prescribing behavior and the physician-patient relationship. We conduct an audit study in which a pair of simulated patients with identical flu-like complaints visits the same physician. Simulated patient A is...

This paper provides a positive analysis of how formal, periodic legislative oversight of regulatory agencies can influence market outcomes and the welfare of regulated industries. Whereas previous research has focused on the political distinction between passive and active legislative oversight,...

Physicians prescribing drugs for patients with schizophrenia and related conditions are remarkably concentrated in their choice among antipsychotic drugs. In 2007 the single antipsychotic drug prescribed by a physician accounted for 66% of all antipsychotic prescriptions written by that...

Economists seeking to improve the efficiency of health care delivery frequently emphasize two issues: the fragmented structure of physician practices and poorly designed physician incentives. This paper analyzes these issues from the perspective of organizational economics. We begin with a brief...

By exploiting a unique health insurance benefit design, we provide novel evidence on the causal association between outpatient and inpatient care. Our results indicate that greater outpatient spending was associated with more hospital admissions: a $100 increase in outpatient spending was...

We present a new model of money management, in which investors delegate portfolio management to professionals based not only on performance, but also on trust. Trust in the manager reduces an investor's perception of the riskiness of a given investment, and allows managers to charge higher fees...

The overuse of medical services including antibiotics is often blamed on Physician Induced Demand. But since this theory is about physician motivations, it is difficult to test. We conduct an audit study in which physician financial incentives, beliefs about what patients want, and desires to...

Expert performance is often evaluated in a one dimensional way by assuming that good experts have good outcomes. We examine the example of expertise in medicine and develop a model that allows for two dimensions of physician performance: Procedural decision making and skill performing...