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Alexander Karpov
''Health care inequality, patient mobility and welfare''
( 2016, Vol. 36 No.2 )
This paper justifies unequal health care quality in a model with two regions and patients differentiated by location and quality perception. There are two efficient regimes of health care quality provision. In the presence of high travel and quality provision costs, qualities should be equal. Reducing these costs results in unequal distribution of quality in effective solution. High health care inequality under a centralised solution is better for the majority of the population as well as for both regions, if the costs are sufficiently low. Market equilibrium implements an efficient solution only when there are high travel and quality provision costs.
Keywords: horizontal and vertical differentiation, health care quality, health care inequality, Hotelling competition
JEL: L1 - Market Structure, Firm Strategy, and Market Performance: General
I1 - Health: General
Manuscript Received : Jan 27 2016 Manuscript Accepted : Jun 11 2016

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