3:30 pm - 5:00 pm
550 General Services Building, 550 General Services Building University of Alberta , Edmonton Alberta
Title: Physician Quality and the Flexner Report of 1910
Speaker: Dr. Brendon Andrews, Assistant Professor, Department of Economics, University of Alberta
Date: Friday, October 20, 2023
Time: 3:30 – 5:00 PM
Location: 550 General Services Building
If patients can be persuaded to switch between licensed providers on the basis of authoritative opinions, policy-makers can harness such reporting as a tool to implement incentives for high-quality care. I employ the landmark Flexner Report (1910) medical school evaluations to show that existing consumer beliefs and market-specific capital such as established reputations are primary threats to effective reporting. This historic report did not target specific physicians, but ruthlessly disparaged the quality of American medical schools and recommended the vast majority be closed. Using linked individual-level data from medical directories, I show that doctors who recently entered a local geographic market and who attended poorly-reviewed schools — not just the recent graduates thereof — were about three times more likely to relocate or retire after the report’s release. Expert recommendations have considerably less impact when providers have established themselves in a local area, and no impact on market exit can be detected. These heterogeneous effects imply that policy-makers are unlikely to dramatically alter consumer demand with expert quality information when trust and reputation are important market features.