Productivity Dispersion in Medicine and Manufacturing

The conventional wisdom in health economics is that large differences in average productivity across US hospitals are the result of idiosyncratic features of the healthcare sector which dull the role of market forces. Strikingly, however, we find that productivity dispersion in heart attack treatmen...

Full description

Bibliographic Details
Main Authors: Syverson, Chad, Chandrashekhar, Amitabh, Finkelstein, Amy, Sacarny, Adam Jon
Other Authors: Massachusetts Institute of Technology. Department of Economics
Format: Article
Language:en_US
Published: American Economic Association 2017
Online Access:http://hdl.handle.net/1721.1/109329
https://orcid.org/0000-0002-9941-6684
Description
Summary:The conventional wisdom in health economics is that large differences in average productivity across US hospitals are the result of idiosyncratic features of the healthcare sector which dull the role of market forces. Strikingly, however, we find that productivity dispersion in heart attack treatment across hospitals is, if anything, smaller than in narrowly defined manufacturing industries such as ready-mixed concrete. While this fact admits multiple interpretations, it suggests that healthcare may have more in common with "traditional" sectors than is often assumed, and relatedly, that insights from research on productivity and allocation in other sectors may enrich analysis of healthcare.