publication . Article . Other literature type . 1991

The Supply of Charity Services by Nonprofit Hospitals: Motives and Market Structure

Richard G. Frank; David S. Salkever;
Open Access
  • Journal: RAND Journal of Economics, volume 22, issue 3 Autumn, pages 430-445
Abstract
This article studies provision of charity care by private, nonprofit hospitals. We demonstrate that in the absence of large positive income effects on charity care supply, convex preferences for the nonprofit hospital imply crowding out by other private or government hospitals. Extending our model to include impure altruism (rivalry) provides a possible explanation for the previously reported empirical result that both crowding out and income effects on indigent care supply are often weak or insignificant. Empirical analysis of data for hospitals in Maryland provides evidence of rivalry on the supply of charity care.
Subjects
free text keywords: Economics and Econometrics, Indigent care, Labour economics, Convex preferences, Market structure, Altruism, media_common.quotation_subject, media_common, Economics, Rivalry, Government, Crowding out
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