Competition and Crowding-Out among Public, Non-Profit, and For-Profit Organizations: Evidence from Outpatient Substance Abuse Treatment

36 Pages Posted: 7 May 2007

See all articles by Andrew Milman Cohen

Andrew Milman Cohen

Board of Governors of the Federal Reserve - Division of International Finance (IFDP)

Beth A. Freeborn

Bureau of Economics

Brian McManus

University of North Carolina (UNC) at Chapel Hill - Department of Economics

Date Written: May 4, 2007

Abstract

U.S. markets for outpatient substance abuse treatment (OSAT) include clinics that are private for-profit, private non-profit, and public (i.e., government-run). We study the market structure of OSAT using recently-developed methods from the empirical industrial organization literature on equilibrium market structure in differentiated product markets. These methods allow us to describe OSAT clinics as heterogeneous in their objectives, their responses to exogenous market characteristics, and their responses to one another. We find that the presence of a public clinic in a market reduces the probability that a private clinic will also participate in the market, which is consistent with crowding-out between public and private provision of OSAT. Crowding out appears to be more prevalent in markets with larger white populations.

Keywords: discrete games, multiple equilibria, structural estimation, healthcare markets, substance abuse treatment, crowding out

JEL Classification: C35, C72, H4, I1, L1, L3

Suggested Citation

Cohen, Andrew Milman and Freeborn, Beth A. and McManus, Brian, Competition and Crowding-Out among Public, Non-Profit, and For-Profit Organizations: Evidence from Outpatient Substance Abuse Treatment (May 4, 2007). Available at SSRN: https://ssrn.com/abstract=984565 or http://dx.doi.org/10.2139/ssrn.984565

Andrew Milman Cohen

Board of Governors of the Federal Reserve - Division of International Finance (IFDP) ( email )

20th St. and Constitution Ave.
Washington, DC 20551
United States

Beth A. Freeborn

Bureau of Economics ( email )

600 Pennsylvania Ave., NW
Washington, DC 20580
United States

Brian McManus (Contact Author)

University of North Carolina (UNC) at Chapel Hill - Department of Economics ( email )

Chapel Hill, NC 27599
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
117
Abstract Views
931
rank
249,675
PlumX Metrics