 The income effect and supplier induced demand. Evidence from primary physician services in NorwayJostein Grytten, Fredrik Carlsen and Irene Skau Applied Economics, 2001, vol. 33, issue 11, 1455-1467 Abstract: A much debated issue within the health economic literature is whether physicians can induce demand for their services. The relationship between physicians' 'nonpractice income' and supply of primary physician services in Norway is examined. It is argued that, if inducement exists, physicians with a low nonpractice income who work in municipalities where competition for patients is high, compensate for lack of patients by inducing demand. This model is adapted to the institutional setting of the Norwegian primary physician services, where there is a fixed fee schedule. The analyses were performed on a large set of data, encompassing all primary care physicians in Norway who are remunerated per item of treatment. Data on output in practice were merged with information about nonpractice income from the tax forms of the physician and her/his spouse. In municipalities with high physician density, nonpractice income had no effect on the number of consultations per physician, or on the number of treatment items per consultation. The results are interpreted as evidence against the inducement hypothesis. Date: 2001 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:applec:v:33:y:2001:i:11:p:1455-1467 Ordering information: This journal article can be ordered from DOI: 10.1080/00036840010009883 Access Statistics for this article Applied Economics is currently edited by Anita Phillips More articles in Applied Economics from Taylor & Francis Journals |
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