Multiproduct Short-Run Hospital Cost Functions: Empirical Evidence and Policy Implications from Cross-Section Data

Cowing, Thomas G.; Holtmann, A. G.

doi:10.2307/1058706

Cited by 196 publications

(103 citation statements)

References 12 publications

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“…The same difficulties in substituting between inputs is found also for medical staff and nurses, with estimated elasticities close to 0.35 for both types of hospitals. This last result is in contrast with Cowing and Holtmann (1983).…”

Section: Bed Downsizing and Workforce Managementcontrasting

confidence: 58%

Restructuring hospital industry to control public health care expenditure: The role of input substitutability

2010

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Abstract. In this paper we investigate the economic rationality of the bed downsizing process, characterising the hospital industry worldwide in the last decades, as a measure to control public health care expenditure. Considering a sample of Italian hospitals, we provide fresh evidence on the factor substitutability in the production of hospital services. Differently from other studies, based on North-American data and confined to pre-determined cost function models, we estimate a general specification (the Generalised Composite), and test it against traditional nested models (e.g., the translog). For all the specifications we derive Allen, Morishima and Shadow elasticities of substitution between input pairs, obtaining a fairly consistent picture across all models and elasticity concepts. In particular, our results highlight a very limited degree of substitutability between factors in the production of hospital services, especially between beds and medical staff.These findings suggest that a restructuring policy of the hospital industry, which is confined to limiting the number of beds without involving workforce management, could not be a viable strategy for controlling public health care expenditure.

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Section: Bed Downsizing and Workforce Managementcontrasting

confidence: 58%

Restructuring hospital industry to control public health care expenditure: The role of input substitutability

2010

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“…5. The same argument is made for the electric power industry (Nelson 1985), hospital costs (Cowing and Holtmann 1983), and costs for school districts (Callan and Santerre 1990). 6.…”

Section: Empirical Implementationmentioning

confidence: 96%

Cost Functions, Efficiency, and Quality in Day Care Centers

Mocan¹

1997

The Journal of Human Resources

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“…Thus, several studies substitute an arbitrary small positive constant (e.g. : 0.01) for zero output values (Jin et al, 2005;Akridge and Hertel, 1986;Gilligan and Smirlock, 1984;Cowing and Holtmann, 1983). We will use this approach as our empirical benchmark model below.…”

Section: Scale and Scope Economies With A Common Technologymentioning

confidence: 99%