A shirking theory of referrals - Damien Eldridge
Tracks
Room: CBE LT1
Thursday, June 29, 2023 |
9:00 AM - 9:30 AM |
Overview
HEALTH I
Convenors: Damien Eldridge and Rohan Pitchford
Speaker
Dr Damien Eldridge
Lecturer In Economics
Australian National University
A shirking theory of referrals
Abstract
The health care industry in some countries displays a gated structure. Rather than approaching a specialist directly, a patient will, in many cases, first seek a referral from a general practitioner. We provide one, but by no means the only, possible explanation for such an industry structure. If the outcome of treatment depends on the effort exerted by the treating specialist, and that effort is both unobservable and unverifiable, then an individual patient might be unable to motivate high effort treatment on the part of the specialist. By aggregating multiple patients, general practitioners can sometimes motivate high effort treatment by the specialist for patients when a single patient acting alone could not do so. If the cost of obtaining a referral does not exceed the additional benefit from high effort treatment, then a patient may, at least weakly, prefer to seek a referral before obtaining treatment from a specialist in such circumstances. (Journal of Economic Literature Classifications: C73, D82, I11.)
Biography
Dr Eldridge is an economist who specialises in microeconomic theory and applied microeconomics. He is particularly interested in applications of microeconomic theory in the fields of industrial organisation, public economics, and health economics. Dr Eldridge has held academic positions at The Australian National University and La Trobe University. He has also been employed as an economist by a number of non-academic organisations, including various Australian Public Service agencies.