Scandinavian Working Papers in Economics

Working Papers,
Lund University, Department of Economics

No 2007:13: Public Hospitals - Incentives and Organization

Eric Rehn ()
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Eric Rehn: Department of Economics, Lund University, Postal: Department of Economics, School of Economics and Management, Lund University, Box 7082, S-220 07 Lund, Sweden

Abstract: This paper presents a novel way to analyze the organization of public hospitals by applying the property rights approach to organizations (PRA) to the problem. It is proposed that while PRA is suitable for the analysis of all hospitals it is especially so for public hospitals.The analysis explores issues concerning privatization and integration of public hospital services. The findings are generally supportive of integration as long as the public principal's human capital is essential for the production of hospital care.

Keywords: Public Hospitals; The Property Rights Approach to Organizations; Joint Production; Integration; Privatization

JEL-codes: D23; I18

31 pages, First version: August 2, 2007. Revised: April 1, 2008. Earlier revisions: April 1, 2008, April 1, 2008.

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