The impact of the institutional form on the cost efficiency of nursing homes

Laura Di Giorgio, Massimo Filippini and Giuliano Masiero
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Laura Di Giorgio: Department of Economics, University of Lugano

Quaderni della facoltà di Scienze economiche dell'Università di Lugano from USI Università della Svizzera italiana

Abstract: In Switzerland, nursing home services are mainly provided by regulated public and private nonprofit organizations. Some of them are created by local governments as foundations. This provides a unique setting to analyze the impact of the institutional form on the performance of nursing homes. We propose a model where the institutional form is represented as a legal constraint which affects managers in the decison-making process. Considering a sample of 44 Swiss Italian nursing homes over a 7-years period (1999-2005), we then disentangle persistent inefficiency due to differences in the institutional form from unobserved heterogeneity. The applied estimation strategy provides more accurate estimates of the impact of the institutional form on nursing homes efficiency, as compared to previous studies. Our results suggest that governmental nursing homes are more costly than private and public foundations. These results are consistent across different model specifications.

Keywords: constant inefficiency; unobserved heterogeneity; nursing homes; nonprofit; institutional form (search for similar items in EconPapers)
JEL-codes: C23 I18 L20 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2012-03
New Economics Papers: this item is included in nep-eff and nep-hea
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Citations: View citations in EconPapers (1)

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