title: Welfare implications of learning through solicitation versus diversification in health care.
abstract: Using Roy's model of sorting behavior, I study welfare implications of learning about medical care quality through the current health care data production infrastructure that relies on solicitation of research subjects. Due to severe adverse-selection issues, I show that such learning could be biased and welfare decreasing. Direct diversification of treatment receipt may solve these issues but is infeasible. Unifying Manski's work on diversified treatment choice under ambiguity and Heckman's work on estimating heterogeneous treatment effects, I propose a new infrastructure based on temporary diversification of access that resolves the prior issues and can identify nuanced effect heterogeneity.
authors.affiliation: Department of Pharmacy, Health Services and Economics, University of Washington, and The NBER, Cambridge, MA 1959 NE Pacific St, Box 357660, Seattle, WA 98195-7660, United States; NBER, Cambridge, MA, United States. Electronic address: basua@uw.edu.
authors.forename: Anirban
authors.initials: A
authors.lastname: Basu
mesh_terms: D015982:Bias; D057186:Comparative Effectiveness Research; D007858:Learning; D008960:Models, Psychological; D015233:Models, Statistical; D018579:Patient Selection; D011787:Quality of Health Care
keywords: Comparative effectiveness research; Diversification; Economic evaluation; Heterogeneity; Instrumental variables; Learning