Hospital competition under pay‐for‐performance: Quality,mortality, and readmissions

Health outcomes, such as mortality and readmission rates, are commonly used as indicators of hospital quality and as a basis to design pay‐for‐performance (P4P) incentive schemes. We propose a model of hospital behavior under P4P where patients differ in severity and can choose hospital based on quality. We assume that risk‐adjustment is not fully accounted for and that unobserved dimensions of severity remain. We show that the introduction of P4P which rewards lower mortality and/or readmission rates can weaken or strengthen hospitals' incentive to provide quality. Since patients with higher severity have a different probability of exercising patient choice when quality varies, this introduces a selection bias (patient composition effect) which in turn alters quality incentives. We also show that this composition effect increases with the degree of competition. Critically, readmission rates suffer from one additional source of selection bias through mortality rates since quality affects the distribution of survived patients. This implies that the scope for counterproductive effects of P4P is larger when financial rewards are linked to readmission rates rather than mortality rates.     

Dancing to the Donors' Tune? Policy Choice in Aid‐Dependent Countries

Current aid rhetoric emphasizes the selective allocation of otherwise unconditional funds in support of the recipients' own plans, in contrast to the old donor practice of bundling money and policies. I show that when recipients have private information, policies reflecting their preferences and knowledge might result in such a regime. However, generous transfers can also induce them to conform to the outcome‐oriented expectations of donors at the expense of lower aid impact. Such behaviour is consistent with an abundance of case‐study evidence. Moderate disagreements over what the optimal policy is could actually produce better results. Certain forms of both donor competition and coordination might also eliminate this distortion, while a donor concern for need only removes incentives for aid‐seeking in the least needy countries. In summary, optimal aid policies are highly context‐specific, and donors should thus concentrate their efforts to practise more informed selectivity.     

Employee emotions during organizational change—Towards a new research agenda

In this research note, we address the role of employee emotions during organizational change processes. While prior studies have examined emotions during a single change, such research analyzes emotions and change as snapshot events. In addition, we lack sufficient knowledge of the role of employee emotions during repeated changes, despite the evidence that organizations increasingly need to adapt to dynamic environments. We address these shortcomings and offer a research agenda on emotions during change, which incorporates the so far neglected view of emotions as processes that unfold during and across organizational changes. Specifically, we illustrate the role of employee emotions during sequential and simultaneous changes and offer six suggestions for future research on emotions in such contexts.     

History-based price discrimination and entry in markets with switching costs: A welfare analysis

We analyze history-based price discrimination in an asymmetric industry, where an incumbent, protected by switching costs, faces an entrant who does not have access to information about consumers’ purchase histories. We demonstrate that consumer surplus is higher with uniform pricing than with history-based price discrimination. We find that the entry decision is invariant to whether the incumbent implements history-based pricing or uniform pricing. This implies that the potential abuse of market dominance imposed by history-based price discrimination is exploitation, not exclusion. Finally, we establish that the profit gain to the incumbent from history-based pricing exceeds the associated loss to consumers.     

Visitors’ acceptance of negative ecological impacts in national parks: comparing the explanatory power of psychographic scales in a Norwegian mountain setting

Even in protected areas, it is inevitable that any human use will produce some impact on natural resources. This study identifies visitors’ tolerance of potential negative ecological impacts from tourism activities and facilities in a Norwegian national park context, based on park visitors’ expressed degree of acceptance of negative effects on particular species of wildlife (wild reindeer and raptors) and on vegetation. Attitudes were analysed using psychographic scales, reflecting respondents’ nature orientations, their specific facility desires, their preferences in a wilderness setting and their concerns about human interaction with the natural environment. Fourteen research hypotheses were tested. Findings demonstrated that the psychographic scales explained more variation in attitudes than most social background and trip characteristics. Higher levels of education among visitors were strongly associated with increased ecological concern; age and gender were not. There was generally strong ecological awareness and eco-centrism among park visitors in general, with a small proportion of wilderness purists. Better trail conditions, signposting and interpretation were sought. But park visitors were also found to possess a complex mixture of needs and drivers. The study found significant potential for strategic alliances between tourism and conservation interests, and key value issues for park governance systems.     

The combined impact of managerial and relational capabilities on innovation in firms

In this paper, a survey of more than 1600 firms in the five largest city regions of Norway is described in order to examine how a firm's innovative capacity is affected by three types of factors: factors related to the manager, the structure of the firm and the broader geographical location. By combining perspectives from the fields of management and economic geography in a logistic regression analysis, we find that the two key drivers of firm-level innovation in Norway are the presence of open-minded managers and evidence of collaboration with international partners. Moreover, these two factors are mutually reinforcing, as firms with open-minded managers also tend to engage more with international partners and vice versa.     

Pyrrhic victories – anticipating the closedown effect

Previous studies with empirical evidence on social responsible driven closedowns have identified a productivity increase effect that occurs during the process of organizational closedowns, known as the closedown effect. Our proposition is that this effect can be anticipated as a consequence of a closedown decision. Encountering four different non social responsible closedown cases, of various durations, we statistically test this proposition. Further, we identify a need for an analytical distinction of the phases of the closedown process, in terms of the primary ‘advanced notice period’ and the secondary ‘countdown period’. Based on the analysis, and with this distinction, we are able to conclude that the productivity increase effect can be anticipated during the countdown period. The comparably longer time frame in the Studding case provides the strongest support for our proposition. From the analysis we suggest hypotheses for further research.     

Hospital Competition and Quality with Regulated Prices*

We analyse the effect of competition on quality in hospital markets with regulated prices, considering the effect of both introducing competition (monopoly versus competition) and increasing competition through either lower transportation costs (increased substitutability) or a higher number of hospitals. With semi‐altruistic providers and a fairly general cost structure, we show that the relationship between competition and quality is generally ambiguous. In contrast to the received body of theoretical literature, this is consistent with, and potentially explains, the mixed empirical evidence.     

Reducing income transfers to refugee immigrants: Does start-help help you start?

We estimate the effect of lowering income transfers to refugee immigrants in Denmark – labeled start-help – using a competing risk framework. Refugee immigrants obtaining residence permit before July 2002 received larger income transfers than those who obtained their residence permit later. Exploiting this ‘quasi-natural’ experiment, we find that the lower income transfer has a positive effect on the job-finding rate after two years in Denmark. We also find that the exit rate from the labour force is positively affected by start-help during the early phases of the integration process. Finally, we find that those with the poorest labour market prospects are the least responsive to the improvement in economic incentives.     

Upper Secondary School Completion and the Business Cycle

Previous evidence suggests that enrollment in post‐compulsory education increases (decreases) in cyclical downturns (upturns). However, little evidence exists on whether enrollment is successfully transformed into completed education. This paper adds to the literature by analyzing the relationship between completion of upper secondary education and regional unemployment using Norwegian regional panel data on students graduating from compulsory school between 1981 and 2004. We find robust evidence that completion rates are countercyclical. Our results suggest that poor labor‐market conditions when starting upper secondary education have a lasting effect and motivate students to stay in school and graduate.