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Productivity change and its driving forces in Chinese healthcare sector

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  • Zhensheng Chen
  • Xueli Chen
  • Tomas Baležentis
  • Xiaoqing Gan
  • Vivian Valdmanis

Abstract

Since the last medical reform in 2009, China’s public hospitals have been facing the changes in the institutional environment. However, the effects of reforms have not been received enough attention to deliver evidence-based implications. In this paper, we first assess the efficiency of regional public hospitals from 2011 to 2018, employing a proposed method based on an additive indicator and an aggregate directional distance function (DDF). The method applied allows for decomposing total factor productivity (TFP) indicator into three components, including technical efficiency change (TEC), total productivity (TP) and scale efficiency change (SEC). Second, following the efficiency assessment, we carry post-efficiency analysis to identify the determinants of efficiency of the public hospitals. The results show that annual average TFP growth rate is 1.38%, which is driven mainly by TEC. Regional disparities of public hospitals’ performance are expanding. Almost 75% of the regions considered show a positive TFP growth. The regression results show that the significant determinants of efficiency of regional public hospitals include the price of and demand for health services.

Suggested Citation

  • Zhensheng Chen & Xueli Chen & Tomas Baležentis & Xiaoqing Gan & Vivian Valdmanis, 2020. "Productivity change and its driving forces in Chinese healthcare sector," PLOS ONE, Public Library of Science, vol. 15(12), pages 1-16, December.
    • Handle: RePEc:plo:pone00:0243460
    DOI: 10.1371/journal.pone.0243460
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    2. Yusi Cheng & Xuejie Bai & Yung‐Ho Chiu, 2023. "Performance evaluation for health‐care sectors using a dynamic network data envelopment analysis approach," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(4), pages 2237-2253, June.

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