scholarly journals Do Larger Health Insurance Subsidies Benefit Patients or Producers? Evidence from Medicare Advantage

2018 ◽  
Vol 108 (8) ◽  
pp. 2048-2087 ◽  
Author(s):  
Marika Cabral ◽  
Michael Geruso ◽  
Neale Mahoney
Keyword(s):  
Health Insurance ◽  
Market Power ◽  
Competitive Markets ◽  
Medicare Advantage ◽  
Central Question ◽  
Difference In Differences ◽  
Legislative Change ◽  
Advantageous Selection ◽  
Pass Through

A central question in the debate over privatized Medicare is whether increased government payments to private Medicare Advantage (MA) plans generate lower premiums for consumers or higher profits for producers. Using difference‑in‑differences variation brought about by a sharp legislative change, we find that MA insurers pass through 45 percent of increased payments in lower premiums and an additional 9 percent in more generous benefits. We show that advantageous selection into MA cannot explain this incomplete pass‑through. Instead, our evidence suggests that market power is important, with premium pass‑through rates of 13 percent in the least competitive markets and 74 percent in the most competitive. (JEL G22, H51, I11, I13, I18)

EXPRESS: Investigating the Effects of Excise Taxes, Public Usage Restrictions, and Anti-Smoking Ads across Cigarette Brands

2021 ◽  
pp. 002224292199456
Author(s):  
Yanwen Wang ◽  
Michael Lewis ◽  
Vishal Singh
Keyword(s):  
Market Power ◽  
Market Share ◽  
Brand Choice ◽  
Continuous Model ◽  
Marketing Strategies ◽  
Brand Strength ◽  
Excise Taxes ◽  
Cigarette Tax ◽  
Pass Through ◽  
The Impact

The prevalence of strong brands such as Coca-Cola, McDonald’s, Budweiser, and Marlboro in “vice” categories has important implications for regulators and consumers. While researchers in multiple disciplines have studied the effectiveness of anti-tobacco counter-marketing strategies, little attention has been given to how brand strength may moderate the efficacy of tactics such as excise taxes, usage restrictions, and educational advertising campaigns. In this research, we use a multiple discrete-continuous model to study the impact of anti-smoking techniques on smokers’ choices of brands and quantities. Our results suggest that while cigarette excise taxes decrease smoking rates, these taxes also result in a shift in market share towards stronger brands. Market leaders may be less affected by tax policies because their market power allows strong brands such as Marlboro to absorb rather than pass through increased taxes. In contrast, smoke-free restrictions cause a shift away from stronger brands. In terms of anti-smoking advertising we find minimal effects on brand choice and consumption. The findings highlight the importance of considering brand asymmetries when designing a policy portfolio cigarette tax hikes, smoke-free restrictions, and anti-smoking advertising campaigns.

scholarly journals The Panzar–Rosse H Statistic and Monopoly. Issues on its Use as a Market Power Measure

2020 ◽  
Vol 0 (0) ◽  
Author(s):  
Juan Manuel Sanchez-Cartas
Keyword(s):  
Market Power ◽  
Power Measure ◽  
Pass Through ◽  
Rule Out

AbstractThis note emphasizes some flaws of the Panzar–Rosse H statistic to address market power. First, I show that it is more related to the pass-through rate than to a market power measure, which implies reconsidering its interpretation and use. Second, I show that the inclusion of other strategic variables rather than prices or quantities may lead to contradictory predictions about market power. Therefore, competition authorities should refrain from using the H statistic to rule out significant market power because it is not a well-behaved measure of the degree of competition.

scholarly journals Market Freedom as Antipower

2013 ◽  
Vol 107 (3) ◽  
pp. 593-602 ◽  
Author(s):  
ROBERT S. TAYLOR
Keyword(s):  
Market Power ◽  
Rule Of Law ◽  
Adam Smith ◽  
Economic Policies ◽  
Competitive Markets ◽  
Economic Exchange ◽  
The Rule Of Law ◽  
Philip Pettit ◽  
Gerald Gaus ◽  
The Right

Historically, republicans were of different minds about markets: some, such as Rousseau, reviled them, while others, like Adam Smith, praised them. The recent republican resurgence has revived this issue. Classical liberals such as Gerald Gaus contend that neorepublicanism is inherently hostile to markets, while neorepublicans like Richard Dagger and Philip Pettit reject this characterization—though with less enthusiasm than one might expect. I argue here that the right republican attitude toward competitive markets is celebratory rather than acquiescent and that republicanism demands such markets for the same reason it requires the rule of law: because both are essential institutions for protecting individuals from arbitrary interference. I reveal how competition restrains—and in the limit, even eradicates—market power and thereby helps us realize “market freedom,” i.e., freedom as nondomination in the context of economic exchange. Finally, I show that such freedom necessitates “Anglo-Nordic” economic policies.

scholarly journals Can Health Insurance Competition Work? Evidence from Medicare Advantage

2014 ◽  
Author(s):  
Vilsa Curto ◽  
Liran Einav ◽  
Jonathan Levin ◽  
Jay Bhattacharya
Keyword(s):  
Health Insurance ◽  
Medicare Advantage

scholarly journals Risk selection into supplemental private health insurance in China

2019 ◽  
Vol 9 (1) ◽  
Author(s):  
Yawen Jiang ◽  
Weiyi Ni
Keyword(s):  
Health Insurance ◽  
Instrumental Variable ◽  
Private Health Insurance ◽  
Developed Countries ◽  
Risk Selection ◽  
Alternative Analysis ◽  
Cross Sectional ◽  
Advantageous Selection ◽  
Using Data ◽  
Sectional Analysis

Abstract Background Information on risk selection is important for the regulation and development of supplemental private health insurance (PHI). The research on risk selection into supplemental PHI has been documented in several developed countries where the regulation of the PHI markets was relatively mature. However, evidence on this important aspect of the supplemental PHI market in China is still absent in the literature. The private insurers in China were not prohibited from discrimination against pre-existing conditions and did not guarantee ongoing enrolment. Therefore, the direction and degree of risk selection could not be inferred using the evidence from the other countries. To provide evidence on risk selection into supplemental PHI in China, we conducted a cross-sectional analysis using data from the 2015 wave of China Health and Retirement Longitudinal Study (CHARLS). Results Using probit models, we found that individuals having better self-reported general health were more likely to enrol in PHI in China, suggesting advantageous selection. This result was confirmed by an alternative analysis using an instrumental variable. We also adjusted the realized occurrence of hospitalization by excluding potential moral hazard effect and showed that the adjusted hospitalization risk was negatively associated with PHI enrolment, which also indicated advantageous selection. Conclusions The findings suggested potential over-insurance of healthier individuals or under-insurance of less healthy individuals. The regulation of the PHI market in China should aim to address the inefficiency. The current study could also contribute to the information base for policymakers in countries where the PHI markets similarly lack strong regulation.

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