Previous studies of hospital competition have found that greater competition leads to higher hospital costs. In this paper we report how the behavior of California's hospitals has changed since the introduction of...
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Previous studies of hospital competition have found that greater competition leads to higher hospital costs. In this paper we report how the behavior of California's hospitals has changed since the introduction of programs intended to contain the rate of increase of hospital costs. Using data that cover the period proceeding and following the introduction of these programs, we found that hospitals in more competitive markets have lowered their costs significantly.
This paper provides an empirical test of the theory of strategic regulatory entry deterrence--the theory that subgroups of firms within an industry will use the regulatory process to increase rivals' costs and the...
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This paper provides an empirical test of the theory of strategic regulatory entry deterrence--the theory that subgroups of firms within an industry will use the regulatory process to increase rivals' costs and thereby deter rivals' entry. The results suggest that the commercial practice restrictions present in the ophthalmic industry deterred chain optical firms' entry into the market. This result in combination with earlier findings that the restrictions increase optometrists' prices suggests that cost-raising strategies can be used to disadvantage rivals or drive them out of the market without the need to lower price.
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