Carnegie Mellon University
1606 Cypress Trl.
Middleton, WI 53562
Institutional Affiliation: Carnegie Mellon University
NBER Working Papers and Publications
|February 2016||Subsidies and Structure: The Lasting Impact of the Hill-Burton Program on the Hospital Industry|
with Martin Gaynor, Seth Richards-Shubik: w22037
The hospital industry is one of the most important industries in the U.S., and industry structure can have profound effects on the functioning of markets. Using county-level panel data, we study the effect of public subsidies from the Hospital Survey and Construction Act of 1946, known as the Hill-Burton program, on hospital capacity, organization of the hospital industry, and utilization. We find that the program generated substantial increases in capacity and these changes were highly persistent, lasting well beyond twenty years. However the increases in capacity at non-profit and public hospitals were partially offset by reductions in capacity at for-profit hospitals. Nonetheless, we estimate that the Hill-Burton program accounted for a net increase of over 70,000 beds nationwide, whic...
Published: Andrea Park Chung & Martin Gaynor & Seth Richards-Shubik, 2017. "Subsidies and Structure: The Lasting Impact of the Hill-Burton Program on the Hospital Industry," The Review of Economics and Statistics, vol 99(5), pages 926-943. citation courtesy of