Health Care Competition and Antibiotic Use in Taiwan

Daniel Bennett, Che Lun Hung, Tsai Ling Lauderdale

Research output: Contribution to journalArticlepeer-review

21 Scopus citations

Abstract

Antibiotic resistance, a negative externality of antibiotic use, is a growing threat to public health. Health care competition may encourage antibiotic use because receiving an antibiotic is a form of 'quality' for many patients. This paper examines the effect of market concentration on antibiotic use in a large, nationally-representative data set from Taiwan. Moving from the 75th percentile to the 25th percentile of market concentration is associated with 6.6 per cent greater antibiotic use. We control for leading market-level confounds, including population density and community health. We also show that the correlation is robust using fixed effects for patients, physicians and diagnoses. We document the correlation between antibiotic use and patient retention, which suggests a mechanism for this result. Finally, we show that strict regulation of antibiotics reduces but does not eliminate the effect of competition on antibiotic use.

Original languageEnglish
Pages (from-to)371-393
Number of pages23
JournalJournal of Industrial Economics
Volume63
Issue number2
DOIs
StatePublished - 1 Jun 2015

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