Competition and Disclosure Incentives: An Empirical Study of HMOs

Ginger Jin, RAND Journal of Economics 36(1), 93-112, May .


I examine Health Maintenance Organizations’ (HMOs) voluntary disclosure of product quality, which is not as complete as unraveling theories predict. After controlling for cost and demand factors, I find that HMOs use voluntary disclosure to differentiate from competitors, with lower disclosure rates in highly competitive markets. These findings are consistent with product differentiation, but challenge the intuition that competition should lead to more provision of quality information.

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