Cut to the Bone Hospital Takeovers and Nurse Employment ContractsJanet Currie (), Mehdi Farsi () and W. Bentley Macleod No 8, Working Papers from Princeton University, Department of Economics, Industrial Relations Section. Abstract: This paper uses data from the 1990s to examine changes in the wages, employment, and e¡èort of nurses in California hospitals following takeovers by large chains. The market for nurses has been described as a classic monopsony, so that one might expect increases in ?rm market power to be associated with declines in wages. However, a basic contracting model predicts e¡èects on e¡èort rather than on wages, which is what we see in the data ?nurses see few declines in wages following takeovers, but see increases in the number of patients per nurse, our measure of e¡èort. We show that our results are also consistent with an extended version of the monopsony model that considers e¡èort, and allows for revenue shifts following a takeover. Finally, we ?nd that these changes are similar in the largest for-profit and non-profit chains, suggesting that market forces are more important than institutional form. New Economics Papers: this item is included in nep-mac Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: http://EconPapers.repec.org/RePEc:pri:indrel:8 Access Statistics for this paper More papers in Working Papers from Princeton University, Department of Economics, Industrial Relations Section. |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
Swedish Business School at Örebro University.