The Evolution of Physician Practice Styles: Evidence from Cardiologist Migration

Abstract

Physician treatment choices for observably similar patients vary dramatically across regions. This paper exploits cardiologist migration to disentangle the role of physician-specific factors such as preferences and learned behavior versus environment-level factors such as hospital capacity and productivity spillovers on physician behavior. Physicians starting in the same region and subsequently moving to dissimilar regions practice similarly before the move. After the move, physician behavior in the first year changes by 0.6–0.8 percentage points for each percentage point change in practice environment, with no further changes over time. This suggests environment factors explain between 60–80 percent of regional disparities in physician behavior. (JEL H75, I11, I12, I18)