TY  - JOUR
AU  - Horwitz,Jill R.
AU  - Nichols,Austin
TI  - What Do Nonprofits Maximize? Nonprofit Hospital Service Provision and Market Ownership Mix
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 13246
PY  - 2007
Y2  - July 2007
UR  - http://www.nber.org/papers/w13246
L1  - http://www.nber.org/papers/w13246.pdf
N1  - Author contact info:
Jill Horwitz
University of Michigan Law School
625 South State Street
Ann Arbor, MI  48109-1215
Tel: 734/763-9501
Fax: 734/764-8309
E-Mail: jrhorwit@umich.edu

Austin Nichols
Urban Institute
2100 M Street, NW
Washington, DC  20037
Fax: Research Associate
E-Mail: anichols@ui.urban.org
AB  - Conflicting theories of the nonprofit firm have existed for several decades yet empirical research has not resolved these debates, partly because the theories are not easily testable but also because empirical research generally considers organizations in isolation rather than in markets.  Here we examine three types of hospitals – nonprofit, for-profit, and government – and their spillover effects.  We look at the effect of for-profit ownership share within markets in two ways, on the provision of medical services and on operating margins at the three types of hospitals.  We find that nonprofit hospitals’ medical service provision systematically varies by market mix.  We find no significant effect of for-profit market share on the operating margins of nonprofit hospitals.  These results fit best with theories in which hospitals maximize their own output.
ER  -