NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Informational Frictions and Practice Variation: Evidence from Physicians in Training

David C. Chan, Jr

NBER Working Paper No. 21855
Issued in January 2016
NBER Program(s):   HC   HE   IO   LS   PR

Substantial practice variation across physicians for seemingly similar patients remains an unresolved puzzle. This paper studies physicians in training to explore the behavioral foundations of practice variation. A discontinuity in the formation of teams reveals a large contribution of relative experience in the size of practice variation. Among the same physician trainees, convergence towards a common practice differs by practice environment, with more convergence in specialist-driven services. Rich trainee characteristics and training histories, including the practice styles of prior supervising physicians, explain little if any variation. These findings suggest a major role for informational frictions in the origins of practice variation.

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This paper was revised on November 4, 2016

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Document Object Identifier (DOI): 10.3386/w21855

 
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