title: Privatization and quality: Evidence from elderly care in Sweden.
abstract: Non-contractible quality dimensions are at risk of degradation when the provision of public services is privatized. However, privatization may increase quality by fostering performance-improving innovation, particularly if combined with increased competition. We assemble a large data set on elderly care services in Sweden between 1990 and 2009 and estimate how opening to private provision affected mortality rates - an important and not easily contractible quality dimension - using a difference-in-difference-in-difference approach. The results indicate that privatization and the associated increase in competition significantly improved non-contractible quality as measured by mortality rates.
authors.affiliation: Södertörn University, Stockholm, Sweden.
authors.forename: Mats A
authors.initials: MA
authors.lastname: Bergman
authors.affiliation: Department of Statistics, IFAU - Institute for Labour Market and Education Policy Evaluation, Institute for the Study of Labor (IZA), Uppsala University, Sweden.
authors.forename: Per
authors.initials: P
authors.lastname: Johansson
authors.affiliation: Department of Economics, Umeå School of Business and Economics, Umeå University, Sweden. Electronic address: sofia.lundberg@umu.se.
authors.forename: Sofia
authors.initials: S
authors.lastname: Lundberg
authors.affiliation: Stockholm School of Economics (SITE), EIEF, Centre for Economic Policy Research (CEPR), University of Rome 'Tor Vergata', Italy.
authors.forename: Giancarlo
authors.initials: G
authors.lastname: Spagnolo
mesh_terms: D000368:Aged; D006299:Health Services for the Aged / Q000191:economics*; D006801:Humans; D011332:Privatization; D013548:Sweden
keywords: Competition; Incomplete contracts; Mortality; Outsourcing; Public procurement