Criminal Prosecution and Physician Supply

42 Pages Posted: 23 Jun 2015 Last revised: 18 Apr 2018

Date Written: August 18, 2017

Abstract

While there are many evidences of the effect of medical malpractice tort, research on the effect of medical malpractice criminal sanctions are scarce. This paper tries to identify the causal effect of criminal prosecution utilizing exogenous variations over the likelihood of criminal prosecution. In 2004, a medical accident occurred in Fukushima prefecture, Japan and an obstetrician was prosecuted one year after. This prosecution exogenously changed the likelihood of criminal prosecution in Fukushima prefecture. Using difference-in-differences and synthetic control approach, we estimate the causal effect of criminal prosecution. The prosecution decreased the number of obstetricians by 13% and some of them changed their business to gynecology, which involves lower risk. However, the effect is concentrated on obstetricians, not all physicians. While the relatively weak estimates of tort liability in the literature might suggest strengthening the present sanctions, we need to be cautious about such policy. In addition, the paper shows that the sentence of acquittal did not resolve the effect caused by the initial prosecution. This illuminates the importance of criminal prosecution itself and its social sanctions, not subsequent criminal sanctions. It also highlights the importance of risk perception of physicians.

Keywords: Medical malpractice, physician supply, criminal prosecution, social sanction, risk perception

JEL Classification: I18, K14

Suggested Citation

Morita, Hatsuru, Criminal Prosecution and Physician Supply (August 18, 2017). International Review of Law and Economics Volume 55, September 2018, Pages 1-11, Available at SSRN: https://ssrn.com/abstract=2621931 or http://dx.doi.org/10.2139/ssrn.2621931

Hatsuru Morita (Contact Author)

Tohoku University ( email )

27-1 Kawauchi Aoba-ku
Sendai, Miyagi 980-8576
Japan
+81-22-795-6224 (Phone)
+81-22-795-6250 (Fax)

HOME PAGE: http://www.law.tohoku.ac.jp/~hatsuru/

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