comparing the welfare effects of public and private health care subsidies in the united kingdom we use a calibrated analytical model to compare the welfare costs gross of externalities of increasing subsidies for public and private health care in the uk the model incorporates wait costs for rationed public care burdens that subsidies impose on the tax system and distributional weights for different households welfare costs are significantly higher for expanding public health care over a range of parameter scenarios both policies reduce average wait times but for public health care this is offset by new waiting costs incurred on extra treatments and the burden on the tax system is much larger for expanding public health care

modelling the dynamics of a public health care system evidence from time series data the english national health service nhs was established in 1948 and has therefore yielded some long time series data on health system performance waiting time for inpatient care have been a persistent policy concern since the creation of the nhs after developing a simple theoretical framework of the dynamic interaction between key indicators of health system performance we investigate empirically the relationship between hospital activity waiting time and population characteristics using aggregate time series data for the nhs over the period 1952 to 2003 structural vector autoregression s var suggests that in the long run higher activity is associated with lower waiting times elasticity 0 9 an increase in the elderly population is associated with higher waiting time elasticity 1 3 in the short run higher lagged waiting time leads to higher activity elasticity 0 12 we also find that shocks in waiting times are countered by higher activity so the effect is only temporary

rationing by waiting and the value of time results from a natural experiment the authors analyze data from a natural experiment with rationing by waiting in the situation motorists were confronted with a choice between waiting in line for low priced gasoline or purchasing at a higher price without waiting they view this as a revealed preference experiment and use their choices to estimate the value of time spent waiting as a function of individual characteristics in most cases the estimates of the value of time are quite similar to individuals after tax wages 13 references 7 tables

a neo schumpeterian model of health services innovation the paper presents and empirically applies a neo schumpeterian model of innovation capable of studying interactions between service providers patients and policy makers and how these complex interactions determine the timing direction and success of innovations in the public sector the model is tested using a case study that traces the introduction and development of ambulatory surgery in a spanish hospital the multi agent model applies the ideas of schumpeter to services encompassing schumpeter s five types of innovation and re introducing the policy maker as a key agent in the innovation process the model has a number of advantages over previous reduced form models first it can analyse the interactions between the economic social and political spheres that make up the complex selection environment of innovations second it captures the recursive impact of radical innovations on agents competences and preferences and their relative power this brings politics power and rhetorical persuasion to the fore third it provides an improved set of definitions for radical and incremental innovation these are not only important for understanding the sources and drivers of innovation but also for the accurate measurement of innovation

internal governance mechanisms and operational performance evidence from index mutual funds we provide new evidence linking board characteristics and performance using manually collected governance data from the mutual fund industry we find an inverse relation between board size and fund performance we also find evidence that organizational form plays an important role in determining operational performance overall the results are consistent with the notion that there may not be a single optimal board structure that is applicable to all funds that attempts to regulate board attributes should be considered with caution and that sponsor level factors are important board structure considerations the author 2009 published by oxford university press on behalf of the society for financial studies all rights reserved for permissions please e mail journals permissions oxfordjournals org oxford university press

a game theoretic model of the relationship between prices and waiting times abstract issue the role of prices charged to patients as a policy instrument for altering waiting times method a game theoretic model is used to examine the determinants of waiting times results under certain circumstances an increase in the price charged to patients at some institutions will lower the waiting times at all institutions conclusions the results provide a set of policy implications and testable predictions that arise under a certain set of assumptions alternative assumptions as well as the policy implications and testable predictions associated with them are also examined

costly search and mutual fund flows this paper studies the flows of funds into and out of equity mutual funds consumers base their fund purchase decisions on prior performance information but do so asymmetrically investing disproportionately more in funds that performed very well the prior period search costs seem to be an important determinant of fund flows high performance appears to be most salient for funds that exert higher marketing effort as measured by higher fees flows are directly related to the size of the fund s complex as well as the current media attention received by the fund which lower consumers search costs

do doctors respond to financial incentives uk family doctors and the gp fundholder scheme abstract the 1991 reforms to the uk nhs created a group of buyers of hospital care from amongst primary care physicians the implementation of the reforms was such that these buyers had incentives to increase their use of hospital services prior to entering the scheme in order to inflate their budgets it has been argued that non financial motives would limit such behaviour the paper shows that these health care providers did respond to the financial incentives offered by the scheme increasing hospital based activity prior to entry and so inflating their budgets upwards for the duration of the fundholding scheme

tax incentives and the demand for private health insurance we analyze the effect of an individual insurance mandate medicare levy surcharge on the demand for private health insurance phi in australia with administrative income tax return data we show that the mandate has several distinct effects on taxpayers behavior first despite the large tax penalty for not having phi coverage relative to the cost of the cheapest eligible insurance policy compliance with mandate is relatively low the proportion of the population with phi coverage increases by 6 5 percentage points 15 6 at the income threshold where the tax penalty starts to apply this effect is most pronounced for young taxpayers while the middle aged seem to be least responsive to this specific tax incentive second the discontinuous increase in the average tax rate at the income threshold created by the policy generates a strong incentive for tax avoidance which manifests itself through bunching in the taxable income distribution below the threshold finally after imposing some plausible assumptions we extrapolate the effect of the policy to other income levels and show that this policy has not had a significant impact on the overall demand for private health insurance in australia

income distribution and macroeconomics this paper analyzes the role of wealth distribution in macroeconomics through investment in human capital it is shown that in the presence of credit markets imperfections and indivisibilities in investment in human capital the initial distribution of wealth affects aggregate output and investment both in the short and in the long run as there are multiple steady states this paper therefore provides an additional explanation for the persistent differences in per capita output across countries furthermore the paper shows that cross country differences in macroeconomic adjustment to aggregate shocks can be attributed among other factors to differences in wealth and income distribution across countries

rationing by waiting lists an implication in a recent article cotton lindsay and bernard feigenbaum 1984 present and test a model of rationing by waiting lists its novel feature is the recognition that being on some types of waiting list involves no opportunity cost and that consumers surplus cannot be dissipated by waiters undertaking costly activities that will help secure the good or service in question in this sense time does not act as a price although it imposes costs although lindsay s earlier version 1980 of this model has already been misinterpreted by some commentators 1 its heart is a waiting list that is equilibrated by attacking the assumption that the demand curve remains unchanged throughout the wait waiting time matters because the value of the good or service decays the longer it is delivered after order day while not wishing to take issue with this insight there are a number of points that need to be borne in mind when assessing the significance of the model especially in relation to the authors application to britain s national health service nhs

finance and income inequality what do the data tell us although there are distinct conjectures about the relationship between finance and income inequality little empirical research compares their explanatory power we examine the relationship between finance and income inequality for 83 countries between 1960 and 1995 because financial develop ment might be endogenous we use instruments from the literature on law finance and growth to control for this our results suggest that in the long run inequality is less when financial development is greater consistent with galor and zeira 1993 and banerjee and newman 1993 although the results also suggest that inequality might increase as financial sector development increases at very low levels of financial sector development as suggested by greenwood and jovanovic 1990 this result is not robust we reject the hypothesis that financial development benefits only the rich our results thus suggest that in addition to improving growth financial development also reduces inequality

rationing by waiting lists an empirical investigation abstract many social systems rely on a waiting list rather than price as a rationing device we present a model of the waiting list for elective surgery in the british national health service waiting time is allowed to influence both supply of and demand for surgery the resulting models of supply and demand are estimated empirically using over 4000 observations the results indicate low elasticity of demand with respect to waiting time suggesting that increased resources may reduce waiting times without greatly stimulating utilization the policy implications are important for the british national government when choosing the level of public expenditure to be devoted to health care

the market for elective surgery joint estimation of supply and demand this paper develops models of the demand for and supply of elective non emergency surgery using a panel of quarterly data for 200 english hospitals over the period 1995 2002 unusually distinct measures of supply outpatients seen and inpatient admissions and demand outpatient referrals and decisions to admit are available for each observation these offer the opportunity to estimate separate empirical models of supply and demand using ordinary least squares ols regression methods however the strong correlation between the residuals of these models suggests some merit in the deployment of seemingly unrelated regression sur methods although both static and dynamic sur estimations leave the results largely qualitatively unchanged sur estimation can have a considerable quantitative effect relative to the ols results for example sur estimation generates a lower elasticity of inpatient demand with respect to waiting time than that obtained via ols the results offer an important justification for more careful econometric modelling of hospital behaviour than has traditionally been employed in the health economics literature

the political economy of public health expenditure and wait times in a public private mixed health care system this paper investigates the determinants of public health expenditure in a public private mixed health care system where a longer wait time for public care is the major difference between public and private sectors voter preferences for health care vary according to their age and by income and public policy choices are part of a multi dimensional competitive political equilibrium we show how equilibrium public health expenditure and wait times depend on demographics and explain why they are independent of the distributions of income and political influence we also show that population aging may not always lead to more public health expenditure ce texte examine les determinants des depenses en sante publique dans un regime mixte public prive de soins de sante quand un temps d attente plus long est la difference majeure entre les secteurs public et prive les preferences des electeurs dans le monde de la sante varient selon l ge et le revenu et les choix de politique publique sont partie d un equilibre politique concurrentiel multidimensionnel on montre que les depenses en sante publique et les temps d attente en equilibre dependent de la demographie et que cela explique pourquoi elles sont independantes de la repartition des revenus et de l influence politique on montre aussi que le vieillissement de la population peut ne pas toujours entrainer des depenses en sante publique additionnelles

socioeconomic inequality of access to healthcare does choice explain the gradient equity of access is a key policy objective in publicly funded healthcare systems however observed inequalities of access by socioeconomic status may result from differences in patients choices using data on non emergency coronary revascularisation procedures in the english national health service we found substantive differences in waiting times within public hospitals between patients with different socioeconomic status up to 35 difference or 43 days between the most and least deprived population quintile groups using selection models with differential distances as identification variables we estimated that only up to 12 of these waiting time inequalities can be attributed to patients choices of hospital and type of treatment heart bypass versus stent residual inequality after allowing for choice was economically significant patients in the least deprived quintile group benefited from shorter waiting times and the associated health benefits were worth up to 850 per person

a note on the integration of system dynamics and economic models equilibrium is probably the principal focus of most areas of economic analysis however the policy maker is often interested not only in the equilibrium predictions arising from an economic model but also in the path taken by policy variables as they move towards that equilibrium it is therefore likely that integration into a dynamic framework will frequently enhance the usefulness of an economic model recent developments in computer software mean that system dynamics offers a readily accessible methodology for making this principle operational the approach is illustrated using an example from the british national health service in which a traditional economic model of supply and demand is deployed within a system dynamics model

finance and inequality a study of indian states although a large literature exists on finance and economic growth few studies have empirically examined the relationship between finance and inequality using grouped national household sample survey data on monthly household consumption expenditure at the sub national level for the years 1999 2000 to 2006 2007 we examine the relationship between financial development fd and rural and urban inequality in india the results indicate that fd is associated with a reduction in inequality but only in the urban areas further inequality is found to be higher in the richer states compared to less developed and low income states and as state income increases inequality also increases both in the rural and urban areas finally our results show that increase in population per bank branch leads to higher inequality in urban areas but decline in rural areas

are investors rational choices among index funds s p 500 index funds represent one of the simplest vehicles for examining rational behavior they hold virtually the same securities yet their returns differ by more than 2 percent per year although the relative returns of alternative s p 500 funds are easily predictable the relationship between cash flows and performance is weaker than rational behavior would lead us to expect we show that selecting funds based on low expenses or high past returns outperforms the portfolio of index funds selected by investors our results exemplify the fact that in a market where arbitrage is not possible dominated products can prosper

demand curves and the pricing of money management one reason why funds charge different prices to their investors is that they face different demand curves one source of differentiation is asset retention performance sensitive investors migrate from worse to better prospects taking their performance sensitivity with them in the cross section we show that past attrition significantly influences the current pricing of retail but not institutional funds in time series we show that the repricing of retail funds after merging in new shareholders is predicted by the estimated effect on its demand curve this result is robust to other influences on repricing including asset and account size changes copyright 2002 oxford university press

competition and waiting times in hospital markets this paper studies the impact of hospital competition on waiting times we use a salop type model with hospitals that differ in geographical locationand potentially waitingtime andtwotypesofpatients high benefitpatientswhochoosebetweenneighbouring hospitals competitive segment and low benefit patients who decide whether or not to demand treatment from the closest hospital monopoly segment compared with a benchmark case of monopoly we find that hospital competition leads to longer waiting times in equilibrium if the competitive segment is sufficiently large given a policy regime of hospital competition the effect of increased competition depends on the parameter of measurement lower travelling costs increase waiting times higher hospital density reduces waiting times while the effect of a larger competitive segment is ambiguous we also show that if the competitive segment is large hospital competition is socially preferable to monopoly only if the regulated treatment price is sufficiently high 2008 elsevier b v all rights reserved

cluster sample methods in applied econometrics inference methods that recognize the clustering of individual observations have been available for more than 25 years brent moulton 1990 caught the attention of economists when he demonstrated the serious biases that can result in estimating the effects of aggregate explanatory variables on individual specific response variables the source of the downward bias in the usual ordinary least squares ols standard errors is the presence of an unobserved state level effect in the error term more recently john pepper 2002 showed how accounting for multi level clustering can have dramatic effects on t statistics while adjusting for clustering is much more common than it was 10 years ago inference methods robust to cluster correlation are not used routinely across all relevant settings in this paper i provide an overview of applications of cluster sample methods both to cluster samples and to panel data sets

contingent valuation of time spent on nhs waiting lists this paper derives estimates of the consumer bourne costs of waiting lists for nonurgent medical care the methodology used is contingent valuation the paper examines the use of this methodology and presents the experimental context and the estimates derived the estimates indicate the average valuation of a month spent on a waiting list for nonurgent care is approximately 40 pounds but also show that there exist significant interpersonal differences in valuations copyright 1990 by royal economic society

dynamic hospital competition under rationing by waiting times abstract we develop a dynamic model of hospital competition where i waiting times increase if demand exceeds supply ii patients choose a hospital based in part on waiting times and iii hospitals incur waiting time penalties we show that whereas policies based on penalties will lead to lower waiting times policies that promote patient choice will instead lead to higher waiting times these results are robust to different game theoretic solution concepts designs of the hospital penalty structure and patient utility specifications furthermore waiting time penalties are likely to be more effective in reducing waiting times if they are designed with a linear penalty structure but the counterproductive effect of patient choice policies is smaller when penalties are convex these conclusions are partly derived by calibration of our model based on waiting times and elasticities observed in the english nhs for a common treatment cataract surgery

a dynamic model of supply of elective surgery in the presence of waiting times and waiting lists this paper analyses hospitals decisions regarding the supply of elective surgery in a dynamic model in the presence of waiting times and waiting lists we show that periods of increasing decreasing supply and increasing decreasing waiting list may be optimal paths towards the steady state we also analyse the hospitals response to exogenous shocks on the demand and the supply for example an increase in the marginal tariff for the provider generates overshooting in the supply supply jumps upwards when the shock is introduced and then slowly reduces towards the steady state value

ramsey waits allocating public health service resources when there is rationing by waiting the optimal allocation of a public health care budget across treatments must take account of the way in which care is rationed within treatments since this will affect their marginal value we investigate the optimal allocation rules for public health care systems where user charges are fixed and care is rationed by waiting the optimal waiting time is higher for treatments with demands more elastic to waiting time higher costs lower charges smaller marginal welfare loss from waiting by treated patients and smaller marginal welfare losses from under consumption of care the results hold for a wide range of welfarist and non welfarist objective functions and for systems in which there is also a private health care sector they imply that allocation rules based purely on cost effectiveness ratios are suboptimal because they assume that there is no rationing within treatments