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Cooperation and conflict between very similar occupations: the case of anesthesia

Published online by Cambridge University Press:  25 June 2010

David E. Kalist ,
Noelle A. Molinari  and
Stephen J. Spurr
David E. Kalist
Affiliation:
Associate Professor, Department of Economics, Shippensburg University, Shippensburg, PA, USA
Noelle A. Molinari
Affiliation:
Research Economist, Department of Economics, Wayne State University, Detroit, MI, USA
Stephen J. Spurr*
Affiliation:
Professor of Economics, Department of Economics, Wayne State University, Detroit, MI, USA
*
*Correspondence to: Stephen J. Spurr, Professor of Economics, Department of Economics, 2115 FAB, Wayne State University, 656 West Kirby, Detroit, MI 48202-3622, USA. Email: sspurr@wayne.edu
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Abstract

This article examines the features of a labor market in which there are two professional groups that both cooperate and directly compete with each other: certified registered nurse anesthetists (CRNAs) and anesthesiologists (MDAs). We examine how the relative numbers of these two types of anesthesia providers, and differences in regulation, affect the earnings of CRNAs, and the extent of supervision of CRNAs by MDAs. We find that both the earnings, and the likelihood of medical supervision of CRNAs, are closely determined by their market share. As the market share of CRNAs increases from 0% to 50%, the gains to MDAs from restricting competition increase; over this range the likelihood that CRNAs are supervised increases and their expected earnings decline. However, as the CRNAs’ market share increases beyond 50%, the costs to MDAs of anticompetitive measures become too large, therefore, the probability of supervision declines, and the earnings of CRNAs increase.

Type
Articles
Information
Health Economics, Policy and Law , Volume 6 , Issue 2 , 16 March 2011 , pp. 237 - 264
Copyright
Copyright © Cambridge University Press 2010

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