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The impacts of marketization and subsidies on the treatment quality performance of the Chinese hospitals sector

Sung Ko Li and Xinju He

China Economic Review, 2019, vol. 54, issue C, 41-50

Abstract: This paper investigates the treatment quality of the hospitals sector in China during 2009–2014. The treatment quality of a hospital is higher if relatively more medical services are provided with fewer deaths. Our research question is twofold: (i) Does the pressure of for-profit lower treatment quality by causing more deaths? (ii) Can government subsidy raise treatment quality by releasing the pressure from market competition? Our empirical results show that the treatment quality in China has been improving during the studied period. There are pieces of evidence that both marketization and government subsidies can boost the treatment quality of the hospitals sector. The co-existence of market force and government regulation is beneficial to the patients.

Keywords: Treatment quality index; Undesirable outputs; Market-oriented reform; Hospitals sector (search for similar items in EconPapers)
JEL-codes: I11 I18 P21 (search for similar items in EconPapers)
Date: 2019
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China Economic Review is currently edited by B.M. Fleisher, K. X. D. Huang, M.E. Lovely, Y. Wen, X. Zhang and X. Zhu

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