Abstract

Public and private healthcare providers coexist in many countries. Typically, consumers must wait for affordable public services, but can cut the queue by paying more at the private provider. Equilibrium waiting times and prices depend on the allocation of labor across the private and public providers. I study how different allocations of dentists across private and public providers affect product market outcomes in the Finnish dental care industry using a structural model of the industry that endogenizes prices, waiting times, and consumer demand. In my counterfactuals, I vary the number and share of dentists at the public providers and analyse effects on the equilibrium waiting times, prices, and consumer demand as well as consumer welfare and private provider profits