A PROBLEM WITH CONSUMER SURPLUS MEASURES OF THE COST OF PRACTICE VARIATIONS

Authors
DRANOVE D
Citation
D. Dranove, A PROBLEM WITH CONSUMER SURPLUS MEASURES OF THE COST OF PRACTICE VARIATIONS, Journal of health economics, 14(2), 1995, pp. 243-251
Citations number
5
Categorie Soggetti
Heath Policy & Services",Economics
Journal title
Journal of health economics → ACNP
ISSN journal
01676296
Volume
14
Issue
2
Year of publication
1995
Pages
243 - 251
Database
ISI
SICI code
0167-6296(1995)14:2<243:APWCSM>2.0.ZU;2-R
Abstract
Estimates of the surplus loss due to physician practice variation meas ure the area under the 'shifted' demand curve. This method is valid on ly if the unshifted demand curve is derived from the distribution of t rue (ex post) values of care. If the unshifted demand curve does not r eflect the true value of care, then the traditional methods of measuri ng surplus loss can be seriously biased.