EC781 Health Economics

Albert Ma; Room 557, 270 Bay State Road;
Office hours: Thursday 11-12:30pm; Friday 2-3:30pm


Health Care, Insurance, Moral Hazard and Adverse Selection

Kenneth J. Arrow, 1963, “The Welfare Economics of Medical Care,” American Economic Review, 53, 941-973

Zeckhauser, Richard, 1970, “Medical Insurance: A Case Study of the Tradeoff between Risk Spreading and Appropriate Incentives,” Journal of Economic Theory, 2, 10-26

Pauly, Mark, 1968, “The Economics of Moral Hazard: Comment,” American Economic Review, 58, 531-537

Ma, Ching-to Albert and Michael H. Riordan, 2002, “Health Insurance, Moral Hazard, and Managed Care,” Journal of Economics & Management Strategy, 11, 81-107

Blomqvist, Ake, 1997, “Optimal non-linear health insurance,” Journal of Health Economics, 16, 303 – 321

Rothschild, Michael and Joseph E. Stiglitz, 1976, “Equilibrium in Competitive Insurance Markets: An Essay on the Economics of Imperfect Information,” Quarterly Journal of Economics (90(4), 630-649

Villeneuve, Bertrand, 2005, “Competition between Insurers with Superior Information,” European Economic Review, 321-340.

Chade, Hector and Edward Schlee, 2012, “Optimal Insurance with Adverse Selection,” Theoretical Economics 7, 571-607.

Chiappori, Pierre-Andre, and Bernard Salanie, 2000, “Testing for Asymmetric Information in Insurance Markets,” Journal of Political Economy, 108, 56-78.

De Meza, David and David C. Webb, 2001, “Advantageous Selection in Insurance Markets,” Rand Journal of Economics, 32, 249-262.

The Patient-Physician Interaction

Dranove, David, 1988, “Demand Inducement and the Physician/Patient Relationship,” Economic Inquiry, 26, 251-298

Rochaix, Lise, 1989, “Information Asymmetry and Search in the Market for Physician Services,” Journal of Health Economics, 8, 53-84.

Ma, Ching-to Albert and Thomas G. McGuire, 1997, “Optimal Health Insurance and Provider Payment,” American Economic Review, 87, 685-704.

Provider Payment and Incentives

Ellis, Randall P. and Thomas G. McGuire, 1986, “Provider Behavior under Prospective Reimbursement: Cost Sharing and Supply,” Journal of Health Economics, 5, 129-151.

Ellis, Randall P. and Thomas G. McGuire, 1990, “Optimal Payment System for Health Services,” Journal of Health Economics, 9, 375-396.

Ma, Ching-to Albert, 1994, “Health Care Payment Systems: Cost and Quality Incentives,” Journal of Economics & Management Strategy, 3, 93-112

Ma, Ching-to Albert, 1998, “Cost and Quality Incentive in Health Care: A Reply,” Journal of Economics & Management Strategy, 7, 139-142, 1998.

Bardey, David, Chiara Canta, and Jean-Marie Lozachmeur, 2012, “The Regulation of Health Care Providers’ Payments when Horizontal and Vertical Differentiation Matter,” Journal of Health Economics, 31, 691-704.

Barros, Pedro Pita, 2003, “Cream-skimming, Incentives for Efficiency and Payment System,” Journal of Health Economics, 22, 419-443.

Jack, William, 2005, “Purchasing health care services from providers with unknown altruism,” Journal of Health Economics, 24, 73-94.

Chone, Philippe and Ching-to Albert Ma, 2011, “Optimal Health Care Contracts under Physician Agency,” Annales d'Economie et de Statistique, Number 101/102, January/June, 229-256.

Liu, Ting and Ching-to Albert Ma, 2013, “Health Insurance, Treatment Plan, and Delegation to Altruistic Physician,” Journal of Economic Behavior & Organization, 85, 79-96.

Allard, Marie, Izabela Jelovac, and Pierre Thomas Léger, 2011, “Treatment and referral decisions under different physician payment mechanisms,” Journal of Health Economics, 30, 880-893.

Selection and Risk Adjustment

Jacob Glazer, and Thomas G. McGuire, 2000, “Optimal Risk Adjustment in Markets with Adverse Selection: An Application to Managed Care,” American Economics Review, 90, 1055-1071.

Glazer, Jacob, and Thomas G. McGuire, 2006, “Optimal Quality Reporting in Markets for Health Plans,” Journal of Health Economics, 25, 295-310

David M. Cutler and Sarah Reber, 1998, “The Tradeoff between Competition and Adverse Selection,” Quarterly Journal of Economics, 113, 433-466.

Miller, Nolan, 2005, “Health Benefits and Wages: Minimizing Total Compensation Cost,” Journal of Health Economics, 24, 931-949

Quality Competition in the Health Market

Ching-to Albert Ma and Jim Burgess, 1993, “Quality Competition, Welfare, and Regulation,” Zeitschrift fur Nationalokonomie, Journal of Economics, Vol. 58, 153-173.

Pedro Pita Barros and Xavier Martinez-Giralt, 2002, “Public and Private Provision of Health Care,” Journal of Economics & Management Strategy, 11, 109-134

Biglaiser, Gary, and Ching-to Albert Ma 2003, “Price and Quality Competition under Adverse Selection: Market Organization and Efficiency,” Rand Journal of Economics, 34, 266-286.

Bardey, David, and Jean-Charles Rochet, 2010, “Competition among Health Plans: a Two-Sided Market Approach,” Journal of Economics & Management Strategy, 19, 435-451.

Olivella, Pau, and Marcos Vera-Hernandez, 2007, “Competition among Differentiated Health Plans under Adverse Selection,” Journal of Health Economics, 26, 233-250.

Managed Care and Health Maintenance Organization

Richard G. Frank, Jacob Glazer, Thomas G. McGuire, 2000 “Measuring Adverse Selection in Managed Health Care,”, Journal of Health Economics, 19, 829-854.

Ma, Ching-to Albert, 2004 “Managed Care and Shadow Price,” Health Economics, 13, 199-202.

Malcomson, James, 2004 “Health Service Gatekeepers,” Rand Journal of Economics, 35, 401-421.

Brekke, Kurt R., Robert Nuscheler and Odd Rune Straume, 2007, “Gatekeeping in Health Care,” Journal of Health Economics, 26, 149-170.

Dranove, David, and Kathryn E. Spier, 2003, “A Theory of Utilization Review,” BE Journal of Economic Analysis and Policy, Contribution, available on-line at

Ma, Ching-to Albert and Thomas G. McGuire, 2002, “Network Incentives in Managed Health Care,” Journal of Economics & Management Strategy, 11, 1-36.

Miller, Nolan, 2006, “Insurer-provider Integration, Credible Commitment, and Managed-care Backlash,” Journal of Health Economics, 25, 861-876.

Public and Private Health Care

Blackorby, Charles and David Donaldson, 1988, “Cash versus Kind, Self-Selection, and Efficient Transfer” American Economic Review, 78, 691-700.

Besley, Timothy, and Stephen Coate, 1991, “Public Provision of Private Goods and The Redistribution of Income,” American Economic Review, 81, 979-984.

Pita Barros, Pedro, and Pau Olivella, 2005, “Waiting Lists and Patient Selection,” Journal of Economics & Management Strategy, 14, 623-646.

Gonzalez, Paula, 2004 “Should Physicians’ Dual Practice be Limited? An Incentive Approach,” Health Economics, 13: 505-524

Biglaiser, Gary, and Ching-to Albert Ma, 2007, “Moonlighting: Public Service and Private Practice,” Rand Journal of Economics, 38, 1113-1133.

Gonzalez, Paula and Ines Macho-Stadler, 2013, “A Theoretical Approach to Dual Practice Regulations in the Health Sector,” Journal of Health Economics, 32, 66-87.

Ma, Ching-to Albert, 2003, “Public Rationing and Private Cost Incentives,” Journal of Public Economics, 88, 333-352.

Hoel, Michael, 2007, “What Should (Public) Health Insurance Cover?” Journal of Health Economics, 26, 251-262.

Grassi, Simona, and Ching-to Albert Ma, 2012, “Public Section Rationing and Private Sector Selection,” Journal of Public Economic Theory, Vol. 14, 1-34.

Grassi, Simona and Ching-to Albert Ma, 2011, “Optimal Public Rationing and Price Response,” Journal of Health Economics, Vol. 30, 1197-1206.