Scandinavian Working Papers in Economics
DaCHE discussion papers,
University of Southern Denmark, Dache - Danish Centre for Health Economics
No 2022:1: Time to revisit the agency theory and expand our thoughts on what motivates physicians? A nudge to health economists
Anne Sophie Oxholm (), Dorte Gyrd-Hansen (), Christian Bøtcher Jacobsen (), Ulrich Thy Jensen () and Line Bjørnskov Pedersen ()
Additional contact information
Anne Sophie Oxholm: University of Southern Denmark, DaCHE - Danish Centre for Health Economics, Postal: DaCHE - Danish Centre for Health Economics, Institut for Sundhedstjenesteforskning, Syddansk Universitet, J.B. Winsløws Vej 9B, 2. sal, DK-5000 Odense, Denmark
Dorte Gyrd-Hansen: University of Southern Denmark, DaCHE - Danish Centre for Health Economics, Postal: DaCHE - Danish Centre for Health Economics, Institut for Sundhedstjenesteforskning, Syddansk Universitet, J.B. Winsløws Vej 9B, 2. sal, DK-5000 Odense, Denmark
Christian Bøtcher Jacobsen: Department of Political Science, Aarhus University, Postal: Bartholins Allé 7, building 1340, 332,, 8000 Aarhus C, Denmark
Ulrich Thy Jensen: School of Public Affairs, Arizona State University, Postal: DTPHX Campus, , Mailcode 3720
Line Bjørnskov Pedersen: University of Southern Denmark, DaCHE - Danish Centre for Health Economics, Postal: DaCHE - Danish Centre for Health Economics, Institut for Sundhedstjenesteforskning, Syddansk Universitet, J.B. Winsløws Vej 9B, 2. sal, DK-5000 Odense, Denmark
Abstract: Health economists typically use agency theory to predict how physicians respond to various policy schemes. Empirical studies show that many schemes lead to unintended responses, indicating that current theoretical models fail to fully explain physicians’ behaviour. Drawing on key lessons from social psychology and public administration literatures, we propose to expand the principal-agent framework by unfolding physicians’ non-pecuniary motives to provide care using three components: patient benefits, intrinsic motivation, and societal benefits (externalities). We argue how each of these motivational components align with the existing agency framework and provide examples of how to measure the degree to which physicians are motivated by these components. Finally, we discuss how physicians’ non-pecuniary motives can be used to inform policymaking.
Keywords: Health care; agency theory; double agency; altruism; externalities; user orientation; intrinsic motivation; public service motivation; non-financial incentives
Language: English
7 pages, January 21, 2022
Full text files
DaCHE_Discussion_Paper_2022_1.pdfFull text
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