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Dealing with Demand Heterogeneity on Health Care Provider Choice –The Case of Rural China

Martine Audibert (), Yong He () and Jacky Mathonnat ()
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Martine Audibert: CERDI - Centre d'Études et de Recherches sur le Développement International - UCA [2017-2020] - Université Clermont Auvergne [2017-2020] - CNRS - Centre National de la Recherche Scientifique
Yong He: CERDI - Centre d'Études et de Recherches sur le Développement International - UCA [2017-2020] - Université Clermont Auvergne [2017-2020] - CNRS - Centre National de la Recherche Scientifique
Jacky Mathonnat: FERDI - Fondation pour les Etudes et Recherches sur le Développement International

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Abstract: We built a database of two samples of patients surveyed within the same regions in rural China over a time interval of 18 years, and presumed varying demand heterogeneity due to income increase and people aging. We find that while the mean price and distance negative effects on patients choice were present in both time periods, their differences in heterogeneity, which were confirmed with the mixed multinomial logit (MMNL), could have crucial importance in avoiding erroneous policy making based merely on mean price and distance effects. We also find that while both the multinomial logit (MNL) and the MMNL are able to predict price and distance effects with low heterogeneity, only the MMNL appears able to detect the price effect when heterogeneity is high. These findings suggest using caution when interpreting estimation results with the MNL in cases of high heterogeneity.

Keywords: Chinese rural households; Healthcare choice; Distance effect; Price effect; Mixed multinomial logit models; Multinomial logit; Preference heterogeneity (search for similar items in EconPapers)
Date: 2020-10-07
New Economics Papers: this item is included in nep-cna, nep-dcm and nep-hea
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-02963761
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Published in Asian Journal of Economics and Empirical Research, 2020, 7, pp.258 - 267. ⟨10.20448/journal.501.2020.72.258.267⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-02963761

DOI: 10.20448/journal.501.2020.72.258.267

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