This paper studies patient volume and the severity of case mix as they relate to physicians' human capital accumulation and pace of technology adoption by exploring a quality signaling mechanism through which physicians build peer reputation. We show that volume building leads physicians to actively manage case mix and find that successful surgeries (particularly for difficult cases) raise future volume, whereas failed surgeries (particularly for easy cases) deplete it. Surgeons with a high patient census and a low-severity case mix adopt the new technology more rapidly. These findings highlight the role of peer reputation for growing practice size and the timing of technology adoption.
Disciplines
Health Services Research | Other Medicine and Health SciencesThis journal article is available at ScholarlyCommons: http://repository.upenn.edu/hcmg_papers/123 289 [ Journal of Human Capital, 2009, vol. 3, no.
The Formation of Peer Reputation among Physicians and Its Effect on Technology AdoptionAmol Navathe and Guy David
University of PennsylvaniaThis paper studies patient volume and the severity of case mix as they relate to physicians' human capital accumulation and pace of technology adoption by exploring a quality signaling mechanism through which physicians build peer reputation. We show that volume building leads physicians to actively manage case mix and find that successful surgeries (particularly for difficult cases) raise future volume, whereas failed surgeries (particularly for easy cases) deplete it. Surgeons with a high patient census and a low-severity case mix adopt the new technology more rapidly. These findings highlight the role of peer reputation for growing practice size and the timing of technology adoption.