Personal research, second opinions, and the diagnostic effort of experts
| Autor: | Kislaya Prasad, Che-Wei Liu, Ritu Agarwal |
|---|---|
| Rok vydání: | 2019 |
| Předmět: |
Service (business)
Organizational Behavior and Human Resource Management Economics and Econometrics Actuarial science business.industry Endowment 05 social sciences Second opinion Investment (macroeconomics) Unobservable Preference Credence good Health care 0502 economics and business Business Information acquisition 050207 economics Marketing Baseline (configuration management) 050205 econometrics |
| Zdroj: | Journal of Economic Behavior & Organization. 158:44-61 |
| ISSN: | 0167-2681 |
| Popis: | In credence goods markets such as those for diagnostic healthcare services, opportunistic experts could either exert costly but unobservable effort, or little effort to identify the service that meets customers’ needs. We investigate the effect of increasing the information endowment of customers in markets where there is a separation of diagnosis and treatment under two alternative institutions: customers (principals) may either directly acquire information through personal research (PR) before consulting the expert or obtain a second opinion (SO) after diagnosis. We compute the market equilibrium conditions for these two institutions and study their effects empirically in a series of experiments with 244 participants. We find that the institution PR dominates the baseline (of no access to information for customers) and SO with respect to market efficiency, and extracts greater effort from experts. Principals use information consistent with theoretical predictions in both institutional settings, and have a preference for PR. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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