• Office cleaning: Two-sided market literature dump

    I just can’t keep everything on paper forever so I purge every so often. Today, I’m tossing my stack of printed two-sided market literature. That only reflects a lower interest in that area in the following narrow sense. I used to think that the lens of two-sided market theory was the right way to view the health care market. And in some instances it is or perhaps could be (e.g. employers or consumers on one side, providers on the other, insurance firms as the platform). But for my interests it isn’t.

    I think the guts of the U.S. health care market dynamics pertain to the interaction of market power between insurers (or self-insured firms) and providers. The interesting policy questions are in the areas of antitrust enforcement and implications for health care costs and premiums. These aren’t two-sided market questions. Or if they are, as far as I know nobody has convincingly formulated them as such.

    A better term for what I’m interested in would be a “two-level market.” Consumers pay premiums in exchange for health care from providers. But there’s a middleman, insurers. In some ways this is not that different from how consumers buy other goods. They pay prices for products produced by manufacturers with retailers in the middle. There are features of the health insurance market that distinguish it from most goods markets, however: information asymmetry (your doctor knows way more than you do about health care), two levels of imperfect competition (provers and insurers), geographic constraints (medical care is mostly local; you can’t buy hospital care on the internet from China (yet)).

    So, even though it is interesting, I’m not as excited by two-sided market theory as I used to be. But I don’t want to lose track of the papers I’ve collected and read. So, here’s a list with links. It substitutes for my paper stack and takes zero space.

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