Low-income self-employed GPs: a preference for leisure?

A-L Samson

Health, Econometrics and Data Group (HEDG) Working Papers from HEDG, c/o Department of Economics, University of York

Abstract: In France, each year between 1993 and 2004, 5 to 7% of general practitioners (GPs) earn less than 1.5 times the level of the French minimum wage. This article examines who are those low-income GPs using a representative panel of French self-employed GPs over the years 1993 to 2004. We .nd that experiencing low incomes, even during a short period of time, has a lasting impact on GPs. incomes over their whole career. Low-income GPs are mainly female or physicians practicing in areas where medical density is high but where the quality of life is also better. To test if low incomes result from a preference for leisure (ie if low-income GPs choose to work less than all other GPs or if they are constrained to), the econometric analysis consists of measuring GPs.reaction to a shock of demand. We show that low-income GPs never react to an increase in demand, while it would give them the opportunity to increase their activity and their incomes. They only react to negative shocks of demand, i.e. they decrease their activity when they are constrained to. Conversely, all other GPs always react to positive and negative shocks of demand : their activity is strongly constrained by the demand they are facing. We conclude that low-income GPs are physicians who choose to work less : to respond to the increasing demand by increasing their activity would reduce their utility. Their low incomes do not re.ect a downgrading of the GPs.profession, but rather one of its advantages: as self-employed, GPs can freely choose their number of hours of work. They may choose to work less.

Keywords: labour supply; labour-leisure trade-off; GPs; self-employed; target income; longitudinal data (search for similar items in EconPapers)
JEL-codes: C23 I12 J22 (search for similar items in EconPapers)
Date: 2010-07
New Economics Papers: this item is included in nep-hea and nep-lab
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Citations: View citations in EconPapers (1)

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