Elasticities of market shares and social health insurance choice in germany: a dynamic panel data approach

Marcus Tamm (), Harald Tauchmann (), Jürgen Wasem and Stefan Greß
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Jürgen Wasem: Institute of Health Care Management, University of Duisburg|Essen, Essen, Germany, Postal: Institute of Health Care Management, University of Duisburg|Essen, Essen, Germany
Stefan Greß: Institute of Health Care Management, University of Duisburg|Essen, Essen, Germany, Postal: Institute of Health Care Management, University of Duisburg|Essen, Essen, Germany

Health Economics, 2007, vol. 16, issue 3, pages 243-256

Abstract: In 1996, free choice of health insurers was introduced to the German social health insurance system. One objective was to increase efficiency through competition. A crucial precondition for effective competition among health insurers is that consumers search for lower-priced health insurers. We test this hypothesis by estimating the price elasticities of insurers' market shares. We use unique panel data and specify a dynamic panel model to explain changes in market shares. Estimation results suggest that short-run price elasticities are smaller than previously found by other studies. In the long-run, however, estimation results suggest substantial price effects. Copyright © 2006 John Wiley & Sons, Ltd.

Date: 2007
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