Abstract
ABSTRACTIt is difficult to assess a doctor's quality. According to theory, doctors provide a classic credence service, in which the quality of the service is difficult or impossible to determine even after its consumption. We challenge the notion that doctors are pure credence goods by analyzing the power of online reviews to predict whether a doctor is unsuitable for medical practice. We use doctor ratings as inputs to our model despite strong debate regarding their informational value in healthcare. We use state medical board sanctions as a signal of doctors’ suitability to practice. We find predictive power in our models: there is indeed a signal of underlying doctor suitability in online ratings. Implications for consumer choice, regulatory surveillance, economic theory, and the usefulness of predictive modeling are discussed.
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