Working Paper: NBER ID: w18678
Authors: Andrew J. Epstein; Sean Nicholson; David A. Asch
Abstract: Our understanding of the determinants of physician skill and the extent to which skill is valued in the marketplace is superficial. Using a large, detailed panel of new obstetricians, we find that, even though physicians' maternal complication rates improve steadily with years of practice, initial skill (as measured by performance in a physician's first year of practice) explains most of the variation in physician performance over time. At the same time, we find that the trajectories of new physicians' delivery volume develop in a way partially consistent with Bayesian learning about physician quality. In particular, as physicians gain experience, their volume becomes increasingly sensitive to the information in their accumulated prior.
Keywords: physician skill; market for physicians; obstetrics; performance trajectories; bayesian learning
JEL Codes: D83; I11; J24; L15
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| market response to performance information (L10) | learning process (J24) |
| initial skill (Y20) | performance (D29) |
| experience (Y60) | performance (D29) |
| cumulative volume (A30) | performance (D29) |
| initial skill (Y20) | explained variation in performance (D29) |
| volume (A30) | performance (D29) |
| initial skill (Y20) | expected outcomes (P27) |