Abstract. Constant Market Share (CMS) analysis is a popular tool for analyzing changes in exports of a country. Nevertheless, its theoretical foundations (and policy relevance) have been questioned. In this paper, we provide such a foundation by relating CMS analysis to a two-stage homothetie demand model. An indication of the empirical relevance of this relationship is given by comparing the CMS analysis with a two-stage Constant Elasticity of Substitution demand model applied to 1972-1976 data of the Economic and Social Commission for Asia and the Pacific (ESCAP).
We study the cost structure and efficiency of Dutch general hospitals over the period 1985-1995. Several studies on the efficiency of hospitals now exist. Most of them start from the assumption that hospital management attempts to minimize cost. We went beyond this assumption by trying to collect empirical evidence on management behaviour with respect to patient selection. We did so by estimating both the direct cost function and the indirect cost function as proposed by Färe and Primont and compared the results. We found that acknowledging the possibility of output reallocation increases the validity of optimizing models in the hospital sector but a complete indirect optimizing model ignores that some output categories are less flexible especially in the short run. Endogenous shifts in the allocation of patients appear to be realized through time by increased specialization of hospitals. We suggest that a mixed direct-indirect cost model is probably preferable.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.