How does service price influence patients’ decisions? An examination of the free-market pricing mechanism in online health communities

Hong Wu (), Zhaohua Deng (), Bin Wang () and Sumeet Gupta ()
Additional contact information
Hong Wu: Huazhong University of Science and Technology
Zhaohua Deng: Huazhong University of Science and Technology
Bin Wang: University of Texas Rio Grande Valley
Sumeet Gupta: Indian Institute of Management Raipur

Electronic Markets, 2021, vol. 31, issue 4, No 9, 877-893

Abstract: Abstract In online health communities (OHCs) in China, physicians can provide online diagnostic services and use the free-market pricing mechanism to price their service so as to encourage quality service. By collecting publicly available patient behavior data for three months for 7726 physicians (with 154,512 records) on an OHC in China, we use the negative binomial model and ordinary least square to empirically investigate the influences of service price on a patient’s sequent decisions including search, purchase, and review based on the medical resource scarcity and social exchange frameworks, and examine how disease risk moderates the magnitude of these effects. Our results show that service price is positively related to patients’ information search and review quality, but negatively related to their purchase and review decisions. In addition, the impacts of service price differ for severe versus mild diseases. Our research contributes to a better understanding of the free-market pricing mechanism on OHCs and provides practical implications for a physician’s pricing strategy in the online environment.

Keywords: Online health communities; Pricing; Search; purchase and review decision; Disease risk; Social exchange (search for similar items in EconPapers)
JEL-codes: D91 I12 L84 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://link.springer.com/10.1007/s12525-020-00453-0 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:elmark:v:31:y:2021:i:4:d:10.1007_s12525-020-00453-0

Ordering information: This journal article can be ordered from
http://www.springer. ... ystems/journal/12525

DOI: 10.1007/s12525-020-00453-0

Access Statistics for this article

Electronic Markets is currently edited by Rainer Alt and Hans-Dieter Zimmermann

More articles in Electronic Markets from Springer, IIM University of St. Gallen
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().