Using Audit Studies to Test for Physician Induced Demand: The Case of Antibiotic Abuse in China

Janet Currie, Wanchuan Lin, Juanjuan Meng

NBER Working Paper No. 18153
Issued in June 2012
NBER Program(s):Health Care, Health Economics

The overuse of medical services including antibiotics is often blamed on Physician Induced Demand. But since this theory is about physician motivations, it is difficult to test. We conduct an audit study in which physician financial incentives, beliefs about what patients want, and desires to reciprocate for a small gift are systematically varied. We find that all of these treatments reduce antibiotics prescriptions, suggesting that antibiotics abuse in China is not driven by patients actively demanding antibiotics, by physicians believing that patients want antibiotics, or by physicians believing that antibiotics are in the best interests of their patients, but is largely driven by financial incentives. Our results also show that physician behavior can be significantly influenced by the receipt of a token gift, such as a pen.

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Document Object Identifier (DOI): 10.3386/w18153

Published: "Addressing Antibiotic Abuse in China: An Experimental Audit Study," Journal of Development Economics, v. 110, Sept. 2014, with Wanchuan Lin and Juanjuan Meng, 39-51

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