The Role of Social Norms on Direct-to-Physician Pharmaceutical Marketing Payment Acceptance

Abstract

In this article, the authors apply institutional theory to explain physician acceptance of pharmaceutical marketing payments and the mechanisms by which the behavior may be influenced by social groups. Using a large panel of over three million physician-year observations, the authors provide evidence that peer and organization norms, captured by the prevalence of peers and organizational members accepting pharmaceutical marketing payments, play an important role in one's decision to accept such payments. The authors further show that this effect attenuates with physical and psychological distances, as proximal social groups most influence one's decision to accept pharmaceutical marketing payments. The authors also find that being male, having longer tenure, or practicing at a teaching hospital strengthens the positive effect of peer influence on volume of pharmaceutical marketing payments accepted. The findings contribute to the literature on institutional theory, provide insights into the management of conflicts of interest, and suggest policy to mitigate the externalities resulting from direct-to-physician pharmaceutical marketing payment.