Skip Nav Destination
1-1 of 1
Follow your search
Access your saved searches in your account
Would you like to receive an alert when new items match your search?
Publisher: Journals Gateway
The Review of Economics and Statistics (2001) 83 (2): 302–309.
Published: 01 May 2001
AbstractView article PDF
Assessing the impact of new technologies on health care costs is an important research area. This paper evaluates two technologies used to treat coronary artery disease. We estimate two separate stochastic frontier models—one for balloon angioplasty patients and one for cardiac bypass surgery patient—using data taken from detailed chart and cost files of a large urban hospital. Cost estimates for the two technologies are purged of inefficiency so that forecasts of the cost consequences of technology shift can be based on ‘best-practice’ production techniques. Learning behavior, physician effects, and patient clinical characteristics are also taken into account. We find that there are potential cost savings associated with making angioplasty a more perfect substitute for bypass surgery, as well as current inefficiency in production.