Price dispersion in the private health insurance industry: The case of Catalonia

M. Oliva and Misericordia Carles

Economic Modelling, 2013, vol. 31, issue C, 177-182

Abstract: This paper presents a vertical and horizontal product differentiation model that explains price dispersion among different kinds of health care insurance firms. Our model shows large insurance firms engaging in price competition with small mutual organizations that serve only a local area and charge lower premiums. We found that, although the market allows the entry of an excessive number of firms, the presence of local insurance companies increases social welfare by increasing the range of products available to consumers. Our conclusions are applicable to OECD countries in general although we rely on Catalonia's data.

Keywords: Industrial organization; Health insurance; Health economics (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:31:y:2013:i:c:p:177-182

DOI: 10.1016/j.econmod.2012.11.029

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