Figure 15.2 shows how increased competition can lead to a higher degree of inducement at point E

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Figure 15.2 shows how increased competition can lead to a higher degree of inducement at point E 2 . This suggests that providers try to induce more usage to compensate for lower profi t margins. Suppose, however, that the physician ends up at a different point, call it E ′ 2 , where there is less inducement than at E1. Could convex indifference curves be drawn so that the change to the m ′ rate of profi t would lead to this reduced inducement?image text in transcribed

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The Economics Of Health And Health Care

ISBN: 9781138208049

8th Edition

Authors: Sherman Folland, Allen C. Goodman, Miron Stano

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