Supply-side Mechanisms Research Articles

Health Insurance Schemes and Their Influences on Healthcare Variation in Asian Countries: A Realist Review and Theory's Testing in Thailand.

Various features in health insurance schemes may lead to variation in healthcare. Unwarranted variations raise concerns about suboptimal quality of care, differing treatments for similar needs, or unnecessary financial burdens on patients and health systems. This realist review aims to explore insurance features that may contribute to healthcare variation in Asian countries; and to understand influencing mechanisms and contexts. We undertook a realist review. First, we developed an initial theory. Second, we conducted a systematic review of peer-reviewed literature in Scopus, MEDLINE, EMBASE, and Web of Science to produce a middle range theory for Asian countries. The Mixed Methods Appraisal Tool (MMAT) was used to appraise the methodological quality of included studies. Finally, we tested the theory in Thailand by interviewing nine experts, and further refined the theory. Our systematic search identified 14 empirical studies. We produced a middle range theory in a context-mechanism-outcome configuration (CMOc) which presented seven insurance features: benefit package, cost-sharing policies, beneficiaries, contracted providers, provider payment methods, budget size, and administration and management, that influenced variation through 20 interlinked demand- and supply-side mechanisms. The refined theory for Thailand added eight mechanisms and discarded six mechanisms irrelevant to the local context. Our middle range and refined theories provide information about health insurance features associated with healthcare variation. We encourage policy-makers and researchers to test the CMOc in their specific contexts. Appropriately validated, it can help design interventions in health insurance schemes to prevent or mitigate the detrimental effects of unwarranted healthcare variation.

Exporters under foreign heat

Abstract In this article, I estimate the effect of foreign weather shocks on firm-level exports, exploiting the French firm-level customs data from 1995 to 2009. I find support for a small, negative impact of foreign temperatures on average but estimate a robust and strong differential effect across exporters, leading to composition changes. Larger firms are more negatively harmed by foreign weather shocks than small exporters. Regarding mechanisms, demand-side mechanisms (such as import demand changes) are mainly at play, whereas I find no evidence for supply-side (competition) mechanisms.

Finance, informal competition, and expectations: A firm-level analysis

This paper documents the link between finance and informal competition. Using longitudinal firm-level data, we show that formal firms that are more exposed to the competition of informal firms are less likely to apply for a bank loan. This result is not due to sample selection, omitted variable bias, or reverse causality, and it is robust to different econometric specifications, including the use of an IV strategy. As for the mechanism explaining our result, we show that firms more exposed to informal competition have worse expectations on future sales growth, which in turn are associated with a lower probability of loan application. Finally, we provide suggestive evidence excluding supply-side mechanisms that may explain heterogeneities in firms’ access to finance.

Cash transfers and human capital outcomes of children in LMICs: A systematic review using PRISMA

With an increasing shift towards cash transfers and the proposition of Universal Basic Income (UBI) as a policy alternative to replace the existing schemes, there has been a rising discussion about the success and failure associated with cash transfers. Therefore, this article carries out a systematic review using PRISMA (Preferred Reporting Items for Systematic Review and Meta-Analysis) to draw inferences and generate evidences with respect to the influence of cash transfers on two aspects of human capital outcomes of children, viz., child health and nutrition, and educational outcomes in low- and middle-income countries (LMICs). Forty four studies were selected on the basis of a four-stage procedure that checked for identification, screening, eligibility and inclusion. The results indicate that majority of cash transfers based on conditionalities, like mandatory attendance in healthcare organisations and educational institutions, proved to be effective in the selected countries. While 7 studies (16%) showed no changes in the outcomes, 5 (11%) depicted negative impact and the rest (73%) presented a positive result. The selected studies suggest that a strong supply-side mechanism in place in LMICs, ensure functional and quality services at health centres and schools in the respective regions and reflect overwhelming outcomes. Furthermore, incentive design, anticipated termination, and supply-side interventions would be instrumental in avoiding a crisis or shock in the economic sense to recipient households.

Motivated Memory in Economics—A Review

Motivated reasoning refers to the idea that people hold certain beliefs about themselves or the world due to their desire to do so, rather than striving for accuracy. This type of belief formation can lead to overconfidence and polarization, as well as facilitate immoral behavior at both the individual and collective levels. One of the supply-side mechanisms for motivated reasoning is motivated memory, or the selective retrieval of past experiences or information based on self-serving criteria. In this article, we review the still young economics literature on motivated memory. Summarizing both theoretical and empirical work, we highlight the key results this literature has produced. We also discuss open questions and potentially exciting avenues for future research in this area.

The Change of Motives to Become and to be a Party Member. An Empirical Analysis of the German Party Membership Studies 1998, 2009 and 2017

In this paper, the thesis is put forward that selective outcome incentives for party membership gain relevance over time. Two possible mechanisms are identified as the cause of this increase in importance: a supply-side mechanism based on processes of societal change that took place through generational succession and a demand-side mechanism focusing on shifts in the self-image and organizational structure of political parties. The supply-side mechanism should lead to changes in the motives of potential members, whereas the demand-side mechanism alters the incentives potential and current members are exposed to.The empirical analyses are based on the German Party Membership Studies of 1998, 2009 and 2017. These three studies are nationwide representative surveys of the members of the following six parties: Christian Democratic Union (CDU), Christian Social Union (CSU), Social Democratic Party of Germany (SPD), Free Democratic Party (FDP), Alliance90/The Greens (Bündnis90/Die Grünen), and The Left (Die Linke). Within the German Party Membership Studies, both the motives for joining the party and the current membership motives are surveyed.Empirically, it is shown that there is indeed an increase in the importance of selective outcome membership motives over the period under study. The mechanisms behind this increase in importance are investigated using multivariate Age-Period-Cohort (APC) models based on the cumulated data of the German Party Membership Studies. These analyses are based on a total of nearly 30,000 cases. The results of the APC analyses are largely consistent with the supply-side explanation of the increased importance of selective outcome motives for party entry and membership. The demand-side explanation is only partially confirmed.

Trade and structural change: An empirical investigation

This paper investigates the role of international trade in explaining the decrease of the tradable sector employment share (agriculture, mining and manufacturing). Borrowing insights from the vast theoretical literature on the determinants of structural change, we build an empirical model that allows distinguishing between long-run and short-run effects. This model is used to investigate the relative importance of the main traditional demand-side and supply-side mechanisms of structural change, assessing, in this context, the role of trade variables. To this end, we use an unbalanced panel of countries for the period 1960–2011 from the EU-KLEMS and GGDC 10-sector databases. Our results suggest that both Engelian income effects, i.e. so-called demand-side drivers, and relative productivity, i.e. the supply-side mechanism, are relevant drivers of structural change, the former, particularly, in the long-run and the latter in the short-run only. We show that international trade directly contributes to structural change: imports are negatively related with employment shifts to tradable sectors in particular in the long-run. By contrast, exports and shifts of employment towards tradables are positively associated. Trade affects structural change also indirectly by enhancing the two internal drivers of structural change, i.e. the supply-side and the demand-side one. When trade is split in intermediate and final goods, we show that in the long-run the negative elasticity of structural change to import is driven by imports of intermediate goods, while the positive sign of exports is driven by exports of final goods.

Increasing Access to Formal Agricultural Credit: The Role of Rural Producer Organisations

Access to agricultural credit contributes to rural development by allowing farmers to carry out profit-maximising investments that increase productivity and income, underlining the importance of exploring ways to increase access to this resource. This paper analyses the role of Rural Producer Organisations (RPOs) in easing access to formal agricultural credit. We build an original dataset comprising 15,000 municipality-year observations of RPO creation and credit allocation in Colombia to estimate a fixed effects model. We show that when the number of RPOs increases in a municipality, aggregate access to credit increases. This positive relation also holds at the individual level, with RPO membership increasing both the likelihood of a farmer requesting credit and of receiving the requested credit. We discuss demand and supply-side mechanisms that plausibly explain these results, and we further show that the relation between RPOs and access to credit is heterogeneous according to the source of credit (public vs. private bank) and the type of farmer to whom it is allocated (low-wealth, mid-wealth or high-wealth farmers). Our results point to the potential of RPOs to improve access not only to input and output markets but also to financial markets.

Corner Store Owner Perspectives on a Prototype Smartphone Application for Increasing Healthy Food Availability in Low-Income Neighborhoods

ObjectivesIn Baltimore, Maryland, there are over 600 independently owned small corner stores that often serve as a main source of food for low-income residents. Gaps in the local food system have caused the cost of healthy foods—like fresh produce—and their transportation to skyrocket, making it challenging for corner store owners to stock fresh foods. Currently, there is no supply-side mechanism to improve the availability of fresh foods at corner stores. To fill this need, the Baltimore Urban food Distribution (BUD) application (app) aims to improve the food distribution network among wholesalers, local farmers, and corner store owners. The aims of this study were to: 1) build trust with corner store owners via regular store visits and engagement and 2) gather feedback on the prototype to inform app development. MethodsMore than 50 formal and informal in-depth interviews (IDIs) and in store conversations were held from March 2021 to November 2021 to gather feedback on the BUD app prototype. A small sub-set of corner store owners received a longer demonstration of the BUD app prototype and various app features. This included creating an account, placing an order and in-app messaging to facilitate collective purchasing and delivery with nearby stores. Stores were visited weekly to build rapport with the store owners and conduct informal follow-up interviews. After each round of interviews, the BUD app was iteratively updated. ResultsThe BUD app was intuitive for users, visually appealing, and positively supported the inclusion of multiple languages. Most corner store owners requested several additional features, including product images and an expansion of products beyond fresh produce, e.g., bottled water and snack food. Multiple store visits helped build trust and long-term relationships with owners, two of which are participating in a pilot-test of the full app. ConclusionsDigital tools that are responsive to the needs of corner stores while also increasing healthy food availability in low-income neighborhoods are urgently needed. Building trust and long-term relationships—as was done in this study—was imperative to building a user-friendly and useful app. The results of this study will be used in the scale-up and pilot testing of a fully functional app in 2022. Funding SourcesNHLBI, NIH, award number R34HL145368.

Subjective Models of the Macroeconomy: Evidence From Experts and Representative Samples

Abstract We study people’s subjective models of the macroeconomy and shed light on their attentional foundations. To do so, we measure beliefs about the effects of macroeconomic shocks on unemployment and inflation, providing respondents with identical information about the parameters of the shocks and previous realizations of macroeconomic variables. Within samples of 6,500 US households and 1,500 experts, beliefs are widely dispersed, even about the directional effects of shocks, and there are large differences in average beliefs between households and experts. Part of this disagreement seems to arise because respondents think of different propagation channels of the shocks, in particular demand- vs. supply-side mechanisms. We provide evidence on the role of associative memory in driving heterogeneity in thoughts and forecasts: contextual cues and prior experiences shape which propagation channels individuals retrieve and thereby which forecasts they make. Our findings offer a new perspective on the widely documented disagreement in macroeconomic expectations.

Qualitative research to inform economic modelling: a case study in older people\u2019s views on implementing the NICE falls prevention guideline

BackgroundHigh prevalence of falls among older persons makes falls prevention a public health priority. Yet community-based falls prevention face complexity in implementation and any commissioning strategy should be subject to economic evaluation to ensure cost-effective use of healthcare resources. The study aims to capture the views of older people on implementing the National Institute for Health and Care Excellence (NICE) guideline on community-based falls prevention and explore how the qualitative data can be used to inform commissioning strategies and conceptual modelling of falls prevention economic evaluation in the local area of Sheffield.MethodsFocus group and interview participants (n = 27) were recruited from Sheffield, England, and comprised falls prevention service users and eligible non-users of varying falls risks. Topics concerned key components of the NICE-recommended falls prevention pathway, including falls risk screening, multifactorial risk assessment and treatment uptake and adherence. Views on other topics concerning falls prevention were also invited. Framework analysis was applied for data analysis, involving data familiarisation, identifying themes, indexing, charting and mapping and interpretation. The qualitative data were mapped to three frameworks: (1) facilitators and barriers to implementing the NICE-recommended pathway and contextual factors; (2) intervention-related causal mechanisms for formulating commissioning strategies spanning context, priority setting, need, supply and demand; and (3) methodological and evaluative challenges for public health economic modelling.ResultsTwo cross-component factors were identified: health motives of older persons; and professional competence. Participants highlighted the need for intersectoral approaches and prioritising the vulnerable groups. The local commissioning strategy should consider the socioeconomic, linguistic, geographical, legal and cultural contexts, priority setting challenges, supply-side mechanisms spanning provider, organisation, funding and policy (including intersectoral) and health and non-health demand motives. Methodological and evaluative challenges identified included: incorporating non-health outcomes and societal intervention costs; considering dynamic complexity; considering social determinants of health; and conducting equity analyses.ConclusionsHolistic qualitative research can inform how commissioned falls prevention pathways can be feasible and effective. Qualitative data can inform commissioning strategies and conceptual modelling for economic evaluations of falls prevention and other geriatric interventions. This would improve the structural validity of quantitative models used to inform geriatric public health policies.

Firm Failure, Scandal, and Employee Exit From Innovation-Driven Industries

Over 100,000 employees join innovation-driven ventures each year, many of which will fail. How does firm failure impact the subsequent career of these employees? Current research primarily focuses on how failure affects executives, leaving a theoretical and empirical gap in our understanding with regards to how firm failure may also affect the modal employee: non-executives. We fill this gap by focusing on the relationship between firm failure and employees exiting the industry. In contrast to prior work, we leverage data from an entire industry (Automatic Speech Recognition), many (158) failure events, and differentiate between failure with and without scandal. Tracking nearly 14,000 employees, we find that the effect of firm failure is contingent on the employee’s role and nature of the failure. Employees from failed firms exit the industry similar to employees who voluntarily leave surviving firms. However, employees from failed firms (with scandal) are the most likely to exit the industry. Furthermore, employees with specialized human capital from failed firms are the most likely to be retained in the industry, but this is not true if the failure involved a scandal. We also discuss demand- versus supply-side mechanisms and the permanent loss of specialized human capital to the industry.

Building Diverse, Equitable, and Inclusive Workplaces: What Works? What Doesn’t? And Why?

This symposium showcases recent research projects focused on questions of diversity, equity, and inclusion (DEI) in the workplace. Companies are keenly aware of the business case for diversity and are increasingly interested in adopting policies and practices designed to foster diverse, inclusive, and equitable workplaces. However, for every empirical study finding a positive outcome associated with a specific DEI practice, there are just as many studies demonstrating backlash, negative outcomes, and false progress. The mechanism by which positive outcomes can be achieved in the modern workplace, and negative outcomes are generated, is under-theorized. In this symposium, we will present fresh insights into the different DEI policies and practices. The contexts in which these phenomena are explored are varied, and include an educational institution, a technology firm, and a pharmaceutical company. The researchers draw on rich, deep literatures from multiple disciplines, such as social psychology, economic sociology, and law and society to inform their findings. And finally, the research design adopted by each project highlights the strengths of quantitative and qualitative research – demonstrating the relationship between hypothesis-generating, inductive qualitative work, and hypothesis-testing, deductive quantitative work. Overall, the symposium will address these goals: (1) highlight new findings and emerging theory on the demand- and supply-side mechanisms of organizational segregation; (2) champion research approaches that integrate qualitative and quantitative research designs and methodologies for conducting research on DEI policies and practices; and (3) provide a forum for discussion of the challenges and opportunities of implementing these policies and practices in the workplace. Digital Pipes and Prisms: Toward a Relational Theory of Gender and Digital Technologies at Work Presenter: Alexandra Feldberg; Harvard Business School (Not) Paying for Diversity: Platform-Based Recruiting and the Commercialization of Diversity Presenter: Summer Jackson; MIT The Limits of Litigation: Why Visibility Matters in Discrimination Lawsuits Presenter: Alexandra Kalev; Tel Aviv U. Presenter: Frank Dobbin; Harvard U. Dropping Anchor: The Effect of a Salary History Ban on Gender-based Disparity in Compensation Presenter: Eliot Sherman; London Business School Presenter: Gillian Ku; London Business School Network Correlates of Workgroup Climate Presenter: Brian Rubineau; McGill U. Presenter: Erin Arcario; boehringer ingelheim Presenter: Shima Yaghoubian; HEC Montreal Presenter: Nancy Di Dia; boehringer ingelheim

Do Children on Medicaid Benefit from a Weak Labor Market? Evidence from the Great Recession

In this article, I estimate the association between weak labor market conditions and the quantity of office-based physician services received by children enrolled in Medicaid. I find that children use more services in areas with higher unemployment during the Great Recession, and the result is not influenced by changes in sample composition. The association could reflect either demand factors such as worsening health or supply factors such as changes in the number of physicians willing to accept Medicaid patients. I provide several pieces of evidence supporting a supply-side mechanism: higher unemployment reduces the demand for physician services by privately-insured patients. Physicians respond to the demand shock by serving more Medicaid enrollees.

Exploring the Enabling Environments, Inherent Characteristics and Intrinsic Motivations Fostering Global Electricity Decarbonization

The need for transitioning towards low-carbon energy systems, and the recent boom in available data, allows for a constant re-evaluation of global electricity sector decarbonization progress, and its underlying theoretical assumptions. Arguably, the existing decarbonization literature and institutional support frameworks focus on top-down supply side mechanisms, where policies, goals, access to financing, and technology innovation are suggested as the main drivers. Here, we synthesize eleven global datasets that range from electricity decarbonization progress, to quality of governance, to international fossil fuel subsidies, and environmental policies, amongst several others, and use methods from data mining to explore the factors that may be fostering or hindering decarbonization progress. This exercise allows us to present numerous hypotheses worth exploring in future research. Some of these hypotheses suggest that policies might be ineffective when misaligned with country specific motivators and inherent characteristics, that even in the absence of policy there are particular inherent characteristics that foster decarbonization progress (e.g., relatively high local energy prices, foreign energy import dependency and the absence of a large extractive resource base), and that the interaction of country-specific enabling environments, inherent characteristics, and motivations is what determines decarbonization progress, rather than stand-alone support mechanisms. We present the hypothesis that existing support mechanisms for decarbonization may be relying too much on blanket strategies (e.g., policies, targets), and that there is a need for support mechanisms that encompass a wider diversity of country-specific underlying conditions.

Social networks and the demand for news

Economic research has documented a robust, positive relationship between media consumption among minority individuals and the size of the minority population in local markets. The theoretical mechanism behind these “preference externaltities” has been understood to be the supply incentive to cater to large groups when fixed costs or other scale economies limit the number of viable products in a local market. We demonstrate that the supply-side mechanism is incomplete: the relationship holds not just for local but also national news outlets. We extend the concept of preference externalities to the demand side, establishing a relationship between the racial composition of local communities and the tendency to seek and share information on online social networks. Using data from a sample of 35,997 internet households and a sample of 11,479 Twitter users, we show that a larger local black population is associated with both larger network size and higher utilization for individual black Twitter users relative to white Twitter users and vice versa. Our results suggest that digitization can exacerbate inequality in news consumption, but also that policies to widen broadband access might narrow the gap.

Patient choice and provider competition – Quality enhancing drivers in primary care?

Patient choice of provider and provider competition have been introduced with the claim that they would lead to improved quality. For this to occur, certain conditions must be fulfilled on both the demand and the supply side. However, supply side-mechanisms – with provider behaviour as central – have been largely neglected in the literature, especially in primary care markets. In this article, we focus on provider behaviour and explore if and how choice and competition function as quality enhancing drivers in Swedish primary care. We explore this through semi-structured interviews with 24 managers and physicians at 13 Swedish primary healthcare centres, conducted from May 2016 to February 2017. The analysis draws on assumptions that for enhanced quality, providers must receive information on patients' choices, analyse it and respond accordingly. One conclusion is that Swedish primary care providers lack information on patients' choices and ‘exits’, which makes it difficult for providers to respond to patients' choices. Furthermore, it is questionable whether choice and competition stimulate enhanced clinical quality. At the same time, choice and competition seems to make providers more aware of accessibility concerns and of their reputation, which they may be stimulated to improve. The article contributes evidence on supply side-mechanisms, and encourages clarification of ‘quality’ in this respect, both on the political arena as well as in theoretical models.

Shock Therapy and Entrepreneurial Flare #Brexit

PurposeMuch has been written about trade deal opportunities after Brexit (e.g. Minford et al., 2017; Singham and Tylecote, 2018) but much less about envisaged “supply side mechanisms” that would translate a Brexit shock into improved UK competitive performance. Indications as to the supply side mechanisms involved can be found in some pro-Brexit writings and speeches and revolve around cutting regulation and reducing taxation, to spur innovation entrepreneurship. The authors contend that these measures align to a broad set of policy measures associated with Economic Shock Therapy, the Laffer Curve and the associated “Washington Consensus” (Williamson, 2005). The authors are looking to stimulate a conversation around whether these measures are most likely to stimulate entrepreneurial innovation and growth. The authors open by contrasting these concepts to growth equilibrium dynamics drawn from Wicksell, Keynes and Schumpeter – and by implication dynamic Walrasian General Equilibrium – to pose the question, is entrepreneur-led growth best led via slashing regulations and taxes or by focussing on correcting existing market failures? The purpose of this paper is to promote controversy and debate as to which “supply side measures” are most effective in enabling entrepreneurial growth.Design/methodology/approachThe authors briefly review the pro-Brexiteer economic framework and relate this to broader Economic Shock Therapy and Laffer Curve concepts; how these have been applied and how some argue they can become “supply side” enablers in a positive Brexit innovation and entrepreneurship transformation. By drawing upon fundamental economic relationships such as Wicksell’s (1898) “Natural Rate of Interest”, the authors highlight the importance of information asymmetry and regulatory distortion in financial markets, resulting in some entrepreneurs (and associated innovations) failing to receive the capital their project merit. The authors pose the question, whether Shock Therapy, Laffer Curve type tax cuts and any Brexit “bonfire of regulation” will raise entrepreneurial growth and success.FindingsBoth Shock Therapy and Laffer Curve inspired tax cuts have a patchy record of success, despite notable achievements in post-1991 Poland. The authors stress entrepreneurs drive innovation and growth, and a key support to them requires correcting “access to finance” market failures. It is questionable if Economic Shocks contribute anything to resolving this fundamental problem.Originality/valueThe authors open the supply side debate on anticipated “Brexit Transformation” in the context of long standing (some maybe long forgotten) theoretical understandings, thereby posing the question as to whether potential Brexit-related deregulation, tax cuts and “Economic Shock” therapy are likely to raise entrepreneurial competitive advantage and success rates. Market failure in financial market support for small firm growth and innovation needs are highlighted. Arguably, economic growth and innovation would be better sustained by addressing these failures, than introducing the “unknowns” and risks associated with a substantial Economic Shock.

Misalignment of Contribution and Pay:When do CEOs capture more (or less) than the value they create?

We examine the relationship between CEOs’ contributions to value creation and their pay. Findings demonstrate that variation in CEO value creation is not reflected in variation in their pay. Variation in pay is significantly larger than variation in CEO contributions. We explain this finding through supply-side and demand-side mechanisms. On the supply-side, we find that CEOs opt for non-monetary pay and accept pay that is lower than their next-best offer. On the demand side, we find that firms are unable to accurately assess CEO human capital. This study is among the first to directly examine the relationship between variation in managerial value creation and managerial value capture.

Endogenous growth of open collaborative innovation communities: a supply-side perspective

This article analyzes the conditions under which open collaborative innovation communities can be generated and are able to grow and prosper in the long run. We build a formal model of the interaction between such communities and the alternative institutional setting based on intellectual property rights that we call Technology. The model accounts for both the communitarian social process taking place inside the community and for the presence of spillovers both across and within each institution. We prove that communities grow endogenously above a certain size threshold, and that such growth depends on supply-side mechanisms centered on the developers’ social motivations and interactions. In a comparative statics analysis, we show that the community’s innovative performance rests not only on its own characteristics (strength of social motivations and/or of protection of the community-produced knowledge) but also on factors outside its scope, namely, the institutional characteristics of Technology. We discuss the managerial and policy implications of our findings.