Information, switching costs, and consumer choice: Evidence from two randomised field experiments in Swedish primary health care

A-Tier
Journal: Journal of Public Economics
Year: 2021
Volume: 196
Issue: C

Score contribution per author:

1.005 = (α=2.01 / 4 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Consumer choice policies may improve the matching of consumers and providers, and may spur competition over quality dimensions relevant to consumers. However, the gains from choice may fail to materialise in markets characterised by information frictions and switching costs. We use two large-scale randomised field experiments in primary health care to examine if individuals reconsider their provider choice when receiving leaflets with comparative information and pre-paid choice forms by postal mail. The first experiment targeted a representative subset of the 1.3 million residents in a Swedish region. The second targeted new residents in the same region, a group expected to have less prior information and lower switching costs than the general population. The propensity to switch providers increased after the interventions in both the population-representative sample (by 0.6–0.8 percentage points, 10–14%) and among new residents (2.3 percentage points, 26%). The results demonstrate that there are demand side frictions in the primary care market. Exploratory analyses indicate that the effects on switching were larger in urban markets and that the interventions had heterogeneous effects on the type of providers chosen, and on health care and drug consumption.

Technical Details

RePEc Handle
repec:eee:pubeco:v:196:y:2021:i:c:s0047272721000268
Journal Field
Public
Author Count
4
Added to Database
2026-01-24