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Price transparency is an increasingly popular solution for high healthcare expenditures in the United States, but little is known about its potential to facilitate patient price shopping. Our objective was to analyze interhospital and interpayer price variability in spine surgery and spine imaging using newly public payer-specific negotiated charges (PNCs). We selected a subset of billing codes for spine surgery and spine imaging at 12 hospitals within a Saint Louis metropolitan area healthcare system. We then compared PNCs for these procedures and tested for significant differences in interhospital and interinsurer IQR using the Mann-Whitney U Test. We found significantly greater IQRs of PNCs as a factor of the insurance plan than as a factor of the hospital for cervical spinal fusions (interinsurer IQR $8256; interhospital IQR $533; P.0001), noncervical spinal fusions (interinsurer IQR $28 423; interhospital IQR $5512; P.001), computed tomographies of the lower spine (interinsurer IQR $595; interhospital IQR $113; P.0001), and MRIs lower spinal canal (interinsurer IQR $1010; interhospital IQR $158; P.0001). There was no significant difference between the interinsurer IQR and the interhospital IQR for lower spine x-rays (interinsurer IQR $107; interhospital IQR $67; P = .0543). Despite some between-hospital heterogeneity, we show significantly higher price variability between insurers than between hospitals. Our single system analysis limits our ability to generalize, but our results suggest that savings depend more on hospital and provider negotiations than patient price shopping, given the difficulty of switching insurers.

We use administrative payroll data to estimate the effect of the minimum wage on employment and wages. We find that both effects are nuanced. While the overall number of low-wage workers in firms d...

Using detailed data for U.S. homeowners, we document a negative, nonlinear relation between the loan-to-value ratio (LTV) of homeowners’ primary residence and their labor income. Consistent with high LTV individuals experiencing constrained mobility, we find stronger effects among subprime, liquidity- constrained individuals and those living in regions with limited alternative local employment opportunities and strict noncompete law enforcement. Though high LTV individuals are less likely to move across MSAs, they are more likely to change jobs without changing their residence. We find no effects among similar neighboring renters employed at the same firm and with a similar job tenure.

We study the impact of a medical breakthrough (HAART) on domestic violence and illicit drug use among low-income women infected with HIV. To identify causal effects, we assume that variation in women's immune system health when HAART was introduced affected how strongly their experience of domestic violence or drug use responded to the breakthrough. Immune system health is objectively measured using white blood cell (CD4) counts. Because the women in our sample were informed of their CD4 count, it is reasonable to assume they react to it. Using this identification strategy, we find that HAART introduction reduced domestic violence and illicit drug use. To explain our estimates, we treat health as a form of human capital and argue that women with more human capital face stronger incentives to make costly investments with future payoffs, such as avoiding abusive partners or reducing illicit drug use.

Objective To investigate factors associated with early IVF treatment discontinuation. Design Retrospective cohort study. Setting Academic medical center. Patient(s) Six hundred sixty-nine first-attempt IVF patients who did not have a live birth. Intervention(s) None. Main Outcome Measure(s) Treatment discontinuation and time to return for a second IVF cycle. Result(s) Women without IVF insurance coverage were more likely to discontinue treatment than women with insurance coverage (adjusted odds ratio [aOR] = 3.12; 95% confidence interval [CI], 2.22–4.40). African-American women were more likely to discontinue treatment (aOR = 2.95; 95% CI, 1.54–5.66) and returned for treatment more slowly (adjusted hazard ratio [aHR] = 0.44; 95% CI, 0.28–0.71) than non-Hispanic white women, regardless of IVF insurance coverage or income. Women with a poor prognosis were more likely to discontinue treatment than women with a good prognosis. Older women with IVF insurance coverage or a good prognosis had a shorter time to return for a second IVF cycle than older women without IVF insurance coverage or with a poor prognosis. Estimated income, distance to clinic, fertility diagnosis, number of oocytes retrieved, and history of previous live birth were not associated with treatment discontinuation or time to return for a second IVF cycle after adjustment for covariates. Conclusion(s) IVF insurance coverage, race, age, and future treatment prognosis are associated with IVF treatment discontinuation and time to return.

We study public policies designed to improve access and reduce costs for in vitro fertilization (IVF). High out-of-pocket prices can deter potential patients from IVF, while active patients have an incentive to risk costly high-order pregnancies to improve their odds of treatment success. We analyze IVF’s rich choice structure by estimating a dynamic model of patients’ choices within and across treatments. Policy simulations show that insurance mandates for treatment or hard limits on treatment aggressiveness can improve access or costs, but not both. Insurance plus price-based incentives against risky treatment, however, can together improve patient welfare and reduce medical costs. (JEL G22, I11, I13, I18, J13, J16)

We examine whether medical innovation can reinforce existing health disparities by disproportionately benefiting socioeconomically advantaged patients. The reason is that less advantaged patients often do not use new medications. This may be due to high costs of new drugs, but could also reflect differences in how side effects of new treatments interact with labor supply. To investigate, we develop a dynamic lifecycle model in which the effect of medical treatment on labor supply varies across sociodemographic groups. We estimate the model using rich data on treatment choices and employment decisions of men infected with HIV. In the model, treatments can improve long-run health, but can also cause immediate side effects that interact with the utility cost of work. Estimates indicate that HIV-infected men often forego medication to avoid side effects, in part to remain employed. This effect is stronger for people with fewer years of education, leading to lower use of treatment and worse health outcomes. As a result, while a breakthrough HIV treatment - known as HAART - improved lifetime utility for all patients, it disproportionately benefitted those with higher levels of completed education, thereby reinforcing existing inequality. A counterfactual subsidy that increases non-labor income reduces employment for all education groups, but only increases adoption of HAART and improves health among lower-education individuals, who face a starker health-work tradeoff.

We use payroll and consumer credit data to estimate the effect of the minimum wage on the debts of low-wage workers. In the three years following a $0.88 increase in the minimum wage, the average low-wage worker experiences a $2,712 increase in income and a $856 decrease in debt. The entire decline in debt comes from a reduction in student loan borrowing among enrolled college students. Former students and non-students, in contrast, borrow more in response to an increase in the minimum wage. Future credit constraints, changes in labor supply, buffer-stock behavior, and several other channels do not explain the reduction in student loan debt. Two consumption-savings models -- one with student debt aversion and the other with a high perceived student loan interest rate -- best match our empirical findings.

To determine the impact of surgical site infections (SSIs) on health care costs following common ambulatory surgical procedures throughout the cost distribution.Data on costs of SSIs following ambulatory surgery are sparse, particularly variation beyond just mean costs.We performed a retrospective cohort study of persons undergoing cholecystectomy, breast-conserving surgery, anterior cruciate ligament reconstruction, and hernia repair from December 31, 2004 to December 31, 2010 using commercial insurer claims data. SSIs within 90 days post-procedure were identified; infections during a hospitalization or requiring surgery were considered serious. We used quantile regression, controlling for patient, operative, and postoperative factors to examine the impact of SSIs on 180-day health care costs throughout the cost distribution.The incidence of serious and nonserious SSIs was 0.8% and 0.2%, respectively, after 21,062 anterior cruciate ligament reconstruction, 0.5% and 0.3% after 57,750 cholecystectomy, 0.6% and 0.5% after 60,681 hernia, and 0.8% and 0.8% after 42,489 breast-conserving surgery procedures. Serious SSIs were associated with significantly higher costs than nonserious SSIs for all 4 procedures throughout the cost distribution. The attributable cost of serious SSIs increased for both cholecystectomy and hernia repair as the quantile of total costs increased ($38,410 for cholecystectomy with serious SSI vs no SSI at the 70th percentile of costs, up to $89,371 at the 90th percentile).SSIs, particularly serious infections resulting in hospitalization or surgical treatment, were associated with significantly increased health care costs after 4 common surgical procedures. Quantile regression illustrated the differential effect of serious SSIs on health care costs at the upper end of the cost distribution.

We construct a structural model of entry into self‐employment to evaluate the impact of policies supporting entrepreneurship. Previous work has recognized that workers may opt for self‐employment due to the nonpecuniary benefits of running a business and not necessarily because they are good at it. Other literature has examined how socio‐emotional skills, such as personality traits, affect selection into self‐employment. We link these two lines of inquiry. The model we estimate captures three factors that affect selection into self‐employment: credit constraints, relative earnings, and preferences. We incorporate personality traits by allowing them to affect sector‐specific earnings as well as preferences. The estimated model reveals that the personality traits that make entrepreneurship profitable are not always the same traits driving people to open a business. This has important consequences for entrepreneurship policies. For example, subsidies for small businesses do not attract talented‐but‐reluctant entrepreneurs, but instead attract individuals with personality traits associated with strong preferences for running a business and low‐quality business ideas.

We study public policies designed to improve access and reduce costs for in vitro fertilization (IVF). High out-of-pocket prices can deter potential patients from IVF, while active patients have an incentive to risk costly high-order pregnancies to improve their odds of treatment success. We analyze IVF's rich choice structure by estimating a dynamic model of patients' choices within and across treatments. Policy simulations show that insurance mandates for treatment or hard limits on treatment aggressiveness can improve access or costs, but not both. Insurance plus price-based incentives against risky treatment, however, can together improve patient welfare and reduce medical costs.

We construct a structural model of entry into self‐employment to evaluate the impact of policies supporting entrepreneurship. Previous work has recognized that workers may opt for self‐employment due to the nonpecuniary benefits of running a business and not necessarily because they are good at it. Other literature has examined how socio‐emotional skills, such as personality traits, affect selection into self‐employment. We link these two lines of inquiry. The model we estimate captures three factors that affect selection into self‐employment: credit constraints, relative earnings, and preferences. We incorporate personality traits by allowing them to affect sector‐specific earnings as well as preferences. The estimated model reveals that the personality traits that make entrepreneurship profitable are not always the same traits driving people to open a business. This has important consequences for entrepreneurship policies. For example, subsidies for small businesses do not attract talented‐but‐reluctant entrepreneurs, but instead attract individuals with personality traits associated with strong preferences for running a business and low‐quality business ideas. Entrepreneurship personality socioemotional skills latent factors J23 J24 J31 J32

This paper develops and estimates a dynamic structural model of demand for a multi-attribute product. The demand side equilibrium supports a product spectrum, the characteristics of which evolve over time in response to supply innovations induced by the composition and extent of aggregate demand. The direction and speed of innovation is inefficient because individuals create an externality by not accounting for their influence on the discovery process. We apply the model to drugs invented to combat the HIV epidemic, during which frequent, incremental innovations in medication were punctuated by sporadic breakthroughs. In this application products differ in their efficacy and their propensity to cause side effects. Our biennial data on four American cities track a replenished panel of individuals for over twenty years, from when drugs were not only ineffective but also created debilitating side effects, to when the market matured. We find that the externalities are quantitatively important and that even a temporary subsidy would have improved average social welfare and been more equitable.

Background There is increasing interest in profiling the quality of individual medical providers. Valid assessment of individuals should highlight improvement opportunities, but must be considered in the context of limitations. Study Design High quality clinical data from the American College of Surgeons NSQIP, gathered in accordance with strict policies and specifications, was used to construct individual surgeon-level assessments. There were 39,976 cases evaluated, performed by 197 surgeons across 9 hospitals. Both 2-level (cases by surgeon) and 3-level (cases by surgeon by hospital) risk-adjusted, hierarchical regression analyses were performed. Outcomes were 30-day postoperative morbidity, surgical site infection, and mortality. Surgeon performance was compared in both absolute and relative terms. "Signal-to-noise" reliability was calculated for surgeons and models. Projected case requirements for reliability levels were generated. Results Surgeon performances could be distinguished to different degrees: morbidity distinguished best, mortality least. Outliers could be identified for morbidity and infection, but not mortality. Reliability was also highest for morbidity and lowest for mortality. Even models with high overall reliability did not assess all providers reliably. Incorporating institutional effects had predictable effects: penalizing providers at "good" institutions, benefiting providers at "poor" institutions. Conclusions Individual surgeon profiles can, at times, be distinguished with moderate or good reliability, but to different degrees in different models. Absolute and relative comparisons are feasible. Incorporating institutional level effects in individual provider modeling presents an interesting policy dilemma, appearing to benefit providers at "poor-performing" institutions, but penalizing those at "high-performing" ones. No portrayal of individual medical provider quality should be accepted without consideration of modeling rationale and, critically, reliability.

We propose a dynamic framework to study the value of medical innovation in the context of infectious disease. We apply our framework to evaluate an HIV treatment breakthrough known as HAART. The model captures how, in lowering both the expected cost and likelihood of HIV infection, HAART reduced the implicit price of risky sex. Forward-looking agents responded by optimally shifting their behaviour. The model also imposes equilibrium constraints, explicitly capturing how optimal shifts in behaviour affect equilibrium choices by changing both infection probabilities and the ease of finding partners willing to engage in risky sex. Using the estimated model, we conduct counterfactual simulations to compute the value of HAART from the perspective of uninfected agents. This includes the option value of the innovation along with value accruing from changes in sex behaviour in response to HAART introduction. We also calculate the added value of a fully functional vaccine from the perspective of both infected and uninfected agents, where infected agents benefit from a vaccine due to resulting shifts in market equilibrium.

Using detailed data for homeowners in the U.S., we document a negative, non-linear relation between the loan-to-value ratio (LTV) of the primary residence and labor income. Consistent with constrained mobility for high LTV individuals, we find stronger effects among sub-prime, liquidity constrained individuals and those living in regions with limited local alternate employment opportunities and strict non-compete law enforcement. Though high LTV individuals are less likely to move residences across MSAs, they are more likely to change jobs without changing their residence. We find no effects among similar neighboring renters employed at the same firm with similar job tenure.

We use administrative payroll data to estimate the effect of the minimum wage on employment and wages. We find that both effects are nuanced. While the overall number of low-wage workers in firms declines, incumbent workers are no less likely to remain employed. We find that firms reduce employment primarily through hiring, and there is significant heterogeneity across the non-tradable and tradable sectors. For wages, we find modest spillovers extending up to $2.50 above the minimum wage. Spillovers accrue to both incumbent workers and new hires, but only within firms that employ a significant fraction of low-wage workers.

We use unique data on careers of investment managers to study the relation between labor markets and productivity differences across sectors in finance. We document significant labor mobility between mutual funds and hedge funds during the 1990s and 2000s. Descriptive evidence suggests potential inefficiencies in the allocation of skill and capital: switching from mutual funds to hedge funds results in large gains in return-based productivity and value-added. Hedge funds absorb mutual fund managers from the left and the right tails of the distribution of abnormal returns, lower Sharpe ratios, and higher volatility. To explain these patterns, we estimate a simple model of supply and demand for labor, with heterogeneous sector-specific skills. The model is identified using shocks to investor demand. Selection of low-skilled mutual managers into hedge funds was driven by a decrease in the mutual fund demand for such managers, an increase in hedge fund demand across the skill distribution, and idiosyncratic expected gains. Selection-adjusted average treatment effects show a much smaller hedge fund premium in return-based productivity and a we cannot reject a zero premium in value added.

For the 10% to 15% of American married couples who experience reproductive problems, in vitro fertilization (IVF) is the leading technologically advanced treatment procedure. However, IVF's expense may prevent many couples from receiving treatment, and those who are treated may take an overly aggressive approach to reduce the probability of failure. Aggressive treatment, which occurs through an increase in the number of embryos transferred during IVF, can lead to medically dangerous multiple births. We evaluated the principle policy proposal-insurance mandates-for improving IVF access and outcomes. We used data from US markets during 1995-2003 to show that broad insurance mandates for IVF result in not only large increases in treatment access but also significantly less aggressive treatment. More limited insurance mandates, which may apply to a subset of insurers or provide weaker guidelines for insurer behavior, generally have little effect on IVF markets.

We aimed to determine whether hospital-level surgical performance was similar across outpatient and inpatient settings.The majority of surgical procedures in the United States are performed in an outpatient setting but most quality improvement focuses on inpatient care.Using data from the 2006 to 2008 American College of Surgeons- National Surgical Quality Improvement Program, risk-adjusted hospital observed to expected ratios for morbidity and mortality were compared for inpatient and outpatient cases. In addition, hospital outpatient performance in each year was compared with performances in subsequent years.Hospitals demonstrated variation in outcomes for outpatient morbidity with both good and poor outliers in each year. Outpatient mortality was so rare as to not support robust modeling. There was a lack of congruence between hospital performance for outpatient morbidity and either inpatient morbidity or inpatient mortality in each year, indicating that inpatient performance is not interchangeable with outpatient performance. Outpatient morbidity performance correlation between years was only moderate (correlations 0.449-0.534, all P0.001) indicating that although outcomes from 1 year mildly predict subsequent years, substitution of data would likely lead to missed opportunities for improvement.Assessments of risk-adjusted hospital-level outpatient morbidity performance demonstrate (1) variability across American College of Surgeons- National Surgical Quality Improvement Program sites; (2) a lack of congruence between outpatient morbidity performance and either inpatient morbidity or mortality performance; (3) year-to-year variation of outpatient morbidity performance at individual institutions. Continuing evaluation of both outpatient and inpatient outcomes is supported. Given the substantial volume of outpatient care delivered, outpatient assessments are likely to be an important component of ongoing quality improvement efforts.

BACKGROUND: Risk-adjusted evaluation is a key component of the American College of Surgeons National Surgical Quality Improvement Program (ACS NSQIP). The purpose of this study was to improve standard ACS NSQIP risk adjustment using a novel procedure risk score. STUDY DESIGN: Current Procedural Terminology codes (CPTs) represented in ACS NSQIP data were assigned to 136 procedure groups. Log odds predicted risk from preliminary logistic regression modeling generated a continuous risk score for each procedure group, used in subsequent modeling. Appropriate subsets of 271,368 patients in the 2008 ACS NSQIP were evaluated using logistic models for overall 30-day morbidity, 30-day mortality, and surgical site infection (SSI). Models were compared when including either work Relative Value Unit (RVU), RVU and the standard ACS NSQIP CPT range variable (CPT range), or RVU and the newly constructed CPT risk score (CPT risk), plus routine ACS NSQIP predictors. RESULTS: When comparing the CPT risk models with the CPT range models for morbidity in the overall general and vascular surgery dataset, CPT risk models provided better discrimination through higher c statistics at earlier steps (0.81 by step 3 vs 0.81 by step 46), more information through lower Akaike's information criterion (127,139 vs 130,019), and improved calibration through a smaller Hosmer-Lemeshow chi-square statistic (48.76 vs 116.79). Improved model characteristics of CPT risk over CPT range were most apparent for broader patient populations and outcomes. The CPT risk and standard CPT range models were moderately consistent in identification of outliers as well as assignment of hospitals to quality deciles (weighted kappa ≥ 0.870). CONCLUSIONS: Information from focused, clinically meaningful CPT procedure groups improves the risk estimation of ACS NSQIP models.

Geographic variations in service utilization have emerged as sentinels of quality of care. We used data from the National Survey of Child and Adolescent Well-Being (NSCAW), the Kaiser Family Foundation, and the Area Resource File to examine interstate variations in psychotropic medication use among children coming into contact with child welfare agencies. Mean probabilities of medication use differed by 13% between California (7.1%) and Texas (20.1%). On regression analyses, children in California had a fifth of the odds of medication use compared to children in Texas, principally, because child characteristics of age, gender, foster care placement, and mental health need seem to be evaluated differently in Texas compared to in other states. These findings suggest that interstate variations in psychotropic medication use are driven by child characteristics, rather than by mental health need. Understanding the clinical contexts of psychotropic medication use is necessary to assure high-quality care for these children.

Objectives. We sought to examine the extent to which children in the child welfare system receive mental health care consistent with national standards. Methods. We used data from 4 waves (3 years of follow-up) of the National Survey of Child and Adolescent Well-Being, the nation's first longitudinal study of children in the child welfare system, and the Area Resource File to examine rates of screening, assessment, and referral to mental health services among 3802 youths presenting to child welfare agencies. Weighted population-averaged logistic regression models were used to identify variables associated with standards-consistent care. Results. Only half of all children in the sample received care consistent with any 1 national standard, and less than one tenth received care consistent with all of them. Older children, those exhibiting externalizing behaviors, and those placed in foster care had, on average, higher odds of receiving care consistent with national standards. Conclusions. Adverse consequences of childhood disadvantage cannot be reduced unless greater collaboration occurs between child welfare and mental health agencies. Current changes to Medicaid regulations that weaken entitlements to screening and assessment may also worsen mental health disparities among these vulnerable children.

Background/Objective: The National Surgical Quality Improvement Program (NSQIP) has demonstrated quality improvement in the VA and pilot study of 14 academic institutions. The objective was to show that American College of Surgeons (ACS)-NSQIP helps all enrolled hospitals. Methods: ACS-NSQIP data was used to evaluate improvement in hospitals longitudinally over 3 years (2005-2007). Improvement was defined as reduction in risk-adjusted "Observed/Expected" (O/E) ratios between periods with risk adjustment held constant. Multivariable logistic regression-based adjustment was performed and included indicators for procedure groups. Additionally, morbidity counts were modeled using a negative binomial model, to estimate the number of avoided complications. Results: Multiple perspectives reflected improvement over time. In the analysis of 118 hospitals (2006-2007), 66% of hospitals improved risk-adjusted mortality (mean O/E improvement: 0.174; P < 0.05) and 82% improved risk adjusted complication rates (mean improvement: 0.114; P < 0.05). Correlations between starting O/E and improvement (0.834 for mortality, 0.652 for morbidity), as well as relative risk, revealed that initially worse-performing hospitals had more likelihood of improvement. Nonetheless, well-performing hospitals also improved. Modeling morbidity counts, 183 hospitals (2007), avoided ~9598 potential complications: ~52/hospital. Due to sampling this may represent only 1 of 5 to lof 10 of the true total. Improvement reflected aggregate performance across all types of hospitals (academic/community, urban/rural). Changes in patient risk over time had important contributions to the effect. Conclusions: ACS-NSQIP indicates that surgical outcomes improve across all participating hospitals in the private sector. Improvement is reflected for both poor- and well-performing facilities. NSQIP hospitals appear to be avoiding substantial numbers of complications- improving care, and reducing costs. Changes in risk over time merit further study.

Objective: To examine the effect of surgeon specialization on patient outcomes, controlling for volume. Background: There is great interest in the degree to which surgical specialization affects outcomes, particularly considering drives to measure and reward quality in healthcare. Although surgical specialization has been previously analyzed with respect to outcomes, most studies have treated it as a dichotomous variable based on academic credentials. We treat it here as a continuous variable defined quantitatively by procedural diversity. Methods: We used 2002 to 2005 patient data from the National Surgical Quality Improvement Program for the Department of Surgery, Barnes Jewish Hospital, St. Louis, Missouri. To quantitate procedural specialization, Herfindahl-Hirschman indices for surgeons were calculated using billing codes. These indices were calculated according to 3 different levels of procedural aggregation. Using conditional logit models, we examined the relationship between these indices and 30-day postoperative mortality rates. Results: Surgeon specialization was inversely related to mortality rates after adjusting for case volume when indices were calculated using medium procedural aggregation (odds ratio for mortality = 0.580 per 0.1 unit Herfindahl increase; P = 0.025) or low aggregation (odds ratio for mortality = 0.510 per 0.1 unit Herfindahl increase; P = 0.015). No relationship was observed at the high level of aggregation. Conclusions: The procedural concentration component of surgical specialization is correlated with improved mortality rates independently of case volume. However, how broadly or narrowly "specialization" is defined has an impact on this relationship.

There is increasing financial pressure to maximize clinical productivity for academic physicians. We examined whether clinical performance feedback alone could contribute to improving the clinical productivity of surgeons in an academic department of surgery.We implemented a clinical performance feedback program in January 2003. We then compared clinical productivity in terms of relative value units (RVUs) of surgeons for 18 months before and 18 months after this intervention, using each surgeon as his or her own control. Regression was performed with dependent variable ln (monthly RVUs) and independent variables "calendar month," "pre/post" January 2003, and "surgeon." The coefficient on "pre/post" reflected average change in RVUs. We also surveyed faculty on their use of and attitudes toward this feedback.There was a 58% survey response. Ninety-two percent of responding faculty reported that they viewed and used the performance feedback, and that it affected their practice. Ninety-two percent believed the information accurately reflected their performance, 89% thought that the comparisons were useful, and 79% desired more feedback information, specifically, comparisons with external benchmarks. When RVU data were examined, the coefficient on change pre- and postintervention indicated a 7.4% increase in productivity (p0.001), or a 6.0% increase (p=0.003) after exclusion of outliers.Performance feedback was associated with a small (6.0%) but significant improvement in productivity in this academic surgical faculty group. Performance feedback can be useful and should be used in conjunction with other management tools for this population.

New information technology systems at hospitals and medical centers provide administrators and policymakers with greater information than ever before on both the characteristics of patients and on the outcomes associated with individual surgeons. This paper develops a Bayesian hierarchical bivariate probit model describing surgeon performance in terms of the 30-day mortality and 30-day morbidity of their patients. We apply the model to a sample of 2,578 patients who received care from one of 36 surgeons at a large hospital. The model is estimated using Markov Chain Monte Carlo (MCMC) simulation methods. After accounting for observed differences in the health status of patients prior to surgery and the complexity of the procedure performed, we construct quality indices measuring surgeon performance in terms of morbidity and mortality. These indices are used to evaluate surgeon performance against absolute standards for morbidity and mortality rates, and then to conduct “head to head” comparisons of individual surgeons within subspecialty surgery departments at the hospital. Our approach highlights the potential benefits of new information technologies for monitoring surgeon quality.

The field of strategic management is predicated fundamentally on the idea that managements' decisions are endogenous to their expected performance implications. Yet, based on a review of more than a decade of empirical research in the Strategic Management Journal, we find that few papers econometrically correct for such endogeneity. In response, we now describe the endogeneity problem for cross-sectional and panel data, referring specifically to management's choice among discrete strategies with continuous performance outcomes. We then present readily implementable econometric methods to correct for endogeneity and, when feasible, provide STATA code to ease implementation. We also discuss extensions and nuances of these models that are sometimes difficult to decipher in more standard treatments. These extensions are not typically discussed in the strategy literature, but they are, in fact, highly pertinent to empirical strategic management research.

This paper assesses the causal impact of late-term (8th month) maternal smoking on birthweight using data from a randomized clinical trial, in which some women were encouraged not to smoke, while others were not. The estimation of treatment effects in this case is made difficult as a result of the presence of non-compliers, women who would not change their smoking status, regardless of the receipt of encouragement. Because these women are not at risk of changing treatment status, treatment effect distributions may be difficult to construct for them. Consequently, the paper focuses on obtaining the distribution of treatment impacts for the sub-set of compliers found in the data. Because compliance status is not observed for all subjects in the sample, a Bayesian finite mixture model is estimated that recovers the treatment effect parameters of interest. The complier average treatment effect implies that smokers give birth to infants weighing 348 g less than those of non-smokers, on average, although the 95% posterior density interval contains zero. The treatment effect is stronger for women who were moderate smokers prior to pregnancy, implying a birthweight difference of 430 g. However, the model predicts that only about 22% of the women in the sample were at risk of changing their smoking behaviour in response to encouragement to quit. Copyright © 2001 John Wiley & Sons, Ltd.

Two economic theories that have had an immense impact on modern strategic management research are Porter's strategic positioning framework (SPF) and Williamson's transaction cost economics (TCE). While both theories have contributed to our understanding of strategic management and to the choice of strategy and structure, each theory offers managerial prescriptions that are incomplete at best. We contend that if followed in isolation, each theory can lead to inferior performance. This paper, which studies the international courier and small package (IC & SP) services in Japan, improves upon prescriptions from both theories by linking Porter's and Williamson's approaches. Our main proposition is contained in three relationships that predict a fit among three strategic choices: market position, resource profile, and organizational structure. We test our predictions with a three-stage, reduced-form, endogenous self-selection model. While our empirical methodology is complicated and relies on a multilevel analysis, the methodology is necessary both for analyzing a constellation of activities in the vertical chain and for assessing strategy, structure, and performance when data can be drawn from only a limited number of firms. Our results suggest that a firm's market position, resource profile, and organizational choice are related in ways predicted by a positioning-economizing perspective, To be sure, our study is ambitious and suffers from a number of limitations; nevertheless, it provides one of the first attempts to theoretically and empirically link Porter's SPF and Williamson's TCE.

This paper is concerned with the problem of determining the effect of a categorical treatment variable on a response given that the treatment is non-randomly assigned and the response (on any given subject) is observed for one setting of the treatment. We consider classes of models that are designed for such problems. These models are subjected to a fully Bayesian analysis based on Markov chain Monte Carlo methods. The analysis of the treatment effect is then based on, amongst other things, the posterior distribution of the potential outcomes (counter-factuals) at the subject level, which is obtained as a by-product of the MCMC simulation procedure. The analysis is extended to models with categorical treatments and binary and clustered outcomes. The problem of model comparisons is also considered. Different aspects of the methodology are illustrated through two data examples.

Possible explanations for earnings differentials in self-employment and paid employment are investigated. The empirical results suggest that the nonpecuniary benefits of self-employment are substantial: Most entrepreneurs enter and persist in business despite the fact that they have both lower initial earnings and lower earnings growth than in paid employment, implying a median earnings differential of 35 percent for individuals in business for 10 years. The differential cannot be explained by the selection of low-ability employees into self-employment and is similar for three alternative measures of self-employment earnings and across industries. Furthermore, the estimated earnings differentials may understate the differences in compensation across sectors since fringe benefits are not included in the measure of employee compensation.

Restricted government spending along with universal health insurance has led to longer queues for surgical procedures in Canada versus the United States. Yet it is unclear whether these treatment delays affect health outcomes. This paper tests this hypothesis by comparing the determinants of wait time for hip-fracture surgery and its impact on postsurgery length of stay and inpatient mortality in Canada and the United States. Hazards for surgery/no surgery and discharge alive versus dead are modeled using a competing-risks model. Day of the week of admission is used to help identify the surgery wait-time distribution. We control for unobserved (to the econometrician) health status which may affect wait times and outcomes by assuming a semiparametric distribution for unobserved heterogeneity. We find that predicted hazards for inpatient mortality are virtually identical in Canada and the United States. Yet wait times for surgery are longer in Canada, and surgery delay has a significant impact on postsurgery length of stay in both countries. However, the magnitude of this effect is small relative to other patient and hospital-specific factors. Focusing attention on treatment delays as a weakness in the Canadian health care system may be misleading policymakers from hospital-specific inefficiencies that may have more-important implications for health care costs and patient welfare. © 2000 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology

The fraction of US Medicare recipients enrolled in health maintenance organizations (HMOs) has increased substantially over the past 10 years. However, the impact of HMOs on health care costs is still hotly debated. In particular, it is argued that HMOs achieve cost reduction through 'cream-skimming' and enrolling relatively healthy patients. This paper develops a Bayesian panel data tobit model of HMO selection and Medicare expenditures for recent US retirees that accounts for mortality over the course of the panel. The model is estimated using Markov Chain Monte Carlo (MCMC) simulation methods, and is novel in that a multivariate t-link is used in place of normality to allow for the heavy-tailed distributions often found in health care expenditure data. The findings indicate that HMOs select individuals who are less likely to have positive health care expenditures prior to enrollment. However, there is no evidence that HMOs disenrol high cost patients. The results also indicate the importance of accounting for survival over the panel, since high mortality probabilities are associated with higher health care expenditures in the last year of life.

National Health Service (NHS) reform introduced incentives for efficiency and cost effectiveness, yet little is known about their effectiveness in reducing waiting times for surgery or improving post-surgical outcomes. This paper finds that waiting times for hip fracture surgery declined after the NHS reforms, and patients were more likely to be discharged to another provider. However, hospitals have not simply shifted the burden of care to other providers, since lengths of stay ending in a discharge to home fell. The effect of wait time on surgical outcomes is small in magnitude and cannot explain the post-reform improvements in outcomes.

It is often said that the elderly in rural developing countries are more valued by the members of the society. One possible economic reason for the relative status of the elderly in rural areas is that they are likely to have accumulated substantial farm-specific capital, thus increasing the productivity of the farm. This paper examines whether the elderly contribute to the agricultural profits of households in rural Cote d'Ivoire in an uncertain environment. We estimate the returns to having elders on the farm using panel data and find that farm-specific experience mitigates the fall in profits in adverse environmental conditions, particularly at the lower end of the profit distribution, thereby contributing to reduce the variance of profits. The results hold even after controlling for the level of household assets and household fixed effects, and the presence of experienced female members.

Many qualified women scientists stop applying for NIH grants in the late postdoctoral and early faculty years.

OBJECTIVES Most tests of the practice-makes-perfect hypothesis have used cross-sectional data, which reveal that patients receiving surgery in high-volume hospitals tend to experience better postsurgery outcomes. This study uses longitudinal data to explicitly examine whether any given hospital's patient outcomes change as its surgery volume varies with time. METHODS Longitudinal data from all hospitals conducting hip fracture surgery in Quebec between 1990 and 1993 were used to examine the relationship between surgery volume and outcomes. The longitudinal data allowed volume to be measured using the actual number of surgeries performed by the admitting hospital in the 12 months before a patient's surgery. Determinants of postsurgery length of stay were assessed using ordinary least squares regression, and the explanators of inpatient mortality were identified using logistic regression. The regressions included fixed effects (hospital-specific dummy variables) to control for systematic differences in outcomes across hospitals that persist with time. Therefore, the coefficient on hip fracture surgery volume in the regression models captured differences in outcomes that were attributable to changes in surgery volume within hospitals with time. RESULTS The fixed effects were significant explanators of both postsurgery length of stay and inpatient mortality, indicating that there were significant differences in outcomes across hospitals that persisted with time. In regressions that excluded the fixed effects, the coefficient on surgery volume was significant. In contrast, the coefficient on surgery volume was insignificant when the fixed effects were included. CONCLUSIONS Longitudinal data revealed that after controlling for differences in hospital outcomes that were fixed with time, hospitals performing more surgeries in one period than in another experienced no significant improvement in outcomes. These results do not support the "practice makes perfect" hypothesis. The volume-outcome relationship for hip fracture patients thus appears to reflect fixed differences in quality between high-volume and low-volume hospitals.

This paper investigates the surgical volume-outcome relationship for patients undergoing hip fracture surgery in Quebec between 1991 and 1993. Using a duration model with multiple destinations which accounts for observed and unobserved (by the researcher) patient characteristics, our initial estimates show that higher surgical volume is associated with a higher conditional probability of live discharge from the hospital. However, these results reflect differences between hospitals rather than differences within hospitals over time: when we also control for differences between hospitals that are fixed over time, hospitals performing more surgeries in period t + 1 than in period t experience no significant change in outcomes, as would be predicted by the 'practice makes perfect' hypothesis. The volume-outcome relationship for hip fracture patients thus appears to reflect quality differences between high and low volume hospitals.

Racial differences in professional basketball player salaries are examined to determine whether the 20% premium paid to whites in the mid-1980s has persisted into the 1990s. OLS and tobit regressions indicate no difference between white and black salaries, controlling for player and team characteristics for the 1994 - 95 season. However, censored quantile regressions show substantial racial differences at certain points in the salary distribution. Whites earn less than blacks at the lower end of the distribution, although the difference is not statistically significant, and varies with minutes played. In contrast, whites receive a significant premium (18%) at the upper end of the salary distribution. These findings are consistent with a form of consumer discrimination in which sports fans prefer to see white star players, all else equal.

Crystals of the layered metal organic framework solid Pb[B(Im)4](NO3)(nH2O) can undergo exchange of the nitrate for perrhenate, a model for pertechnetate, forming Pb[B(Im)4](ReO4). We can monitor this reaction by 207Pb solid-state NMR and can isolate single crystals of the resultant material through growth in the presence of an excess of perrhenate. Such a synthetic metal-organic framework solid represents a new candidate for pertechnetate-sequestering materials.

We propose a dynamic framework to study the option value of medical innova- tion, which accrues - in expectation - to healthy individuals who anticipate some possibility of future illness. We apply our framework to evaluate an HIV treatment breakthrough known as HAART. In lowering both the expected cost and likelihood of HIV infection, HAART reduced the implicit price of risky sex. Forward-looking agents responded by optimally shifting their behavior. The magnitude of their responses permits identication of health state dependent utility parameters, from which we can derive the the option value of medical innovation. We nd that the option value of HAART introduction for healthy, uninfected agents corresponds to between 2 and 4 years of life, with greater value accruing to individuals with stronger preferences for risky sex or a higher propensity to quickly fall ill once infected with HIV.

This paper utilizes a new panel data set of workers employed by the Canadian Pacific Railway between 1904 and 1929 to analyse the incidence of long-term employment and reasons for changes in job durations after World War I. The hazard function estimates indicate that individuals have only a small probability of staying for more than ten years at the firm, although at any point in time long-term workers constitute a sizable fraction of employees. Increasing post-war spell lengths reflect the changing composition of the workforce rather than differences in macro-economic conditions or changes in employment relationships. Specific human capital and job matching were also important: Long-term employees were shielded from both firm-specific and economy-wide downturns.

This paper uses a sample of employee records from the Canadian Pacific Railway to study changes between 1903 and 1938 in the composition of job separations, and the probability of separation. The proportion of voluntary departures fell by more than half after World War I. Independent competing risk, piecewise-constant hazard functions for the probabilities of quits and layoffs are estimated. Changes in workforce composition lengthened the average worker's spell, but a worker with any given set of characteristics was much more likely to be laid off after 1921, although many of these layoffs were only temporary.

This paper investigates the effect of wait time for hip fracture surgery in Canada on post-surgery length of stay in hospital and inpatient mortality. After controlling for observed and unobserved patient and hospital characteristics, pre-surgery delay has little effect on either of the two outcome variables. Patients from higher income postal-codes experience only slightly shorter delays, and income has no substantial effect on post-surgery outcomes. For hip fracture patients surgery delay may lead to greater pre-surgery inpatient costs and more patient discomfort, but we find no evidence of a detrimental impact on post-surgery outcomes.